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ENGLAND'S  DEBT  TO  INDIA 


OTHER  BOOKS  BY  LAJPAT  RAI 

YOUNG  INDIA 

An  Interpretation  and  a  History  of  the  Nationalist 
Movement  from  Within 

Price  $1.50  net 

AN  OPEN  LETTER  TO  LLOYD  GEORGE 

Price  25  cents  net 

THE  ARYA  SAMAJ 

An  account  of  its  Origins, 
Doctrines  and  Activities 

Price  $1.75  net 

OBTAINABLE    FROM    ALL    BOOKSEXLERS 

England's  Debt  to  India 

A  Historical  Narrative  of  Britain's 
Fiscal  Policy  in  India 


By 

LAJPAT  RAI 

Author  of  "Young  India." 


"  The  food  beneath  the  harrow  knows 
Exactly  where  each  tooth-point  goes. 
The  butterfly  upon  the  road 
Preaches  contentment  to  the  toad." 


%^ 


NEW  YORK 

B.  W.  HUEBSCH 

1917 


L^ 


COPYRIGHT,  1917,  BY 
B.  W.  HUEBSCH 


PRINTED   IN    THE   UNITED  STATES   OF    AMERICA 


L 


AS  A  MARK  OF  THE  AUTHOR'S  DEEP  RESPECT 

AND 

INDIA'S  GRATITUDE, 
THIS  BOOK  IS  DEDICATED 

TO 

THOSE  BRAVE,  HIGHMINDED.  AND  HONEST  ENG- 
LISHMEN AND  ENGLISHWOMEN  WHO  HAVE  NOT 
HESITATED  TO  SPEAK  THE  TRUTH  ABOUT  THE 
EFFECTS  OF  BRITISH  RULE  IN  INDIA  THOUGH 
BY  DOING  SO  THEY  EARNED  THE  DISLIKE  OF 
THEIR  COUNTRYMEN, 

AND 

ON    WHOSE    TESTIMONY,     PRINCIPALLY,    THIS 
BOOK  IS  BASED. 

Lajpat  Rai. 


C>' 


"  India  will  not  remain,  and  ought  not  to  remain 
content  to  be  a  hewer  of  wood  and  a  drawer  of  water 
for  the  rest  of  the  Empire." 

— J.  Austen  Chamberlain, 
Secretary  of  State  for  India,  in  the  London 
Times,  March  30,  1917. 


PREFACE 

This  book  is  a  kind  of  companion  volume  to  my 
other  book,  "  Young  India."  In  "  Young  India,"  I 
have  discussed  British  rule  in  India,  from  the  political 
standpoint.  In  this  volume,  I  have  discussed  its  eco- 
nomic  effects.  Thexe  is  not  a-gingle  statenient  injthis 
volume  which  is  not  supported  by  the  best^  available 
BritisTi  testfmony,  official  and  non-official.  My  own 
opinrons  and  personal  knowledge  have  Ijeeh  mentioned 
only  incidentally  if  at  all.  Similarly  the  opinions 
of  other  Indian  publicists  have  been  kept  in  the  back- 
ground. It  is  a  sad  commentary  on  the  prevailing 
moral  code  of  the  world  that  those  who  succeed  in 
imposing  their  rule  upon  less  powerful  nations  should 
also  brand  the  latter  as  unworthy  of  credit.  Thus 
every  Britisher  believes  that  an  Indian  critic  of  British 
rule  is  necessarily  affected  by  the  "  inevitable  racial 
and  political  bias  "  of  his  position,  while  he  in  his  turn 
is  entirely  free  from  it! 

In  the  ordinary  course  of  nature,  the  man  whom  the 
shoe  pinches  is  the  best  person  to  know  about  it  but 
in  politics  the  laws  of  nature  are  reversed.  In  judg- 
ing of  governments  and  rulers,  it  is  they  whose  word 
is  to  be  accepted  and  not  that  of  the  governed  and  the 
ruled. 

Consequently^o_avoi^  that  charge  I  have  chosen  to 

speak   from  the  mouths  of  tJhe  EnglishT  themselves. 

'  '"  1 " 


PREFACE 

Looked  at  from  that  point  of  view  the  volume  lays 
no  claim  to  originality.  It  is  more  or  less  a  compila- 
tion from  British  publications,  government  and  private. 
The  case  for  India  has  before  this  been  most  elo- 
quently put  forth  by  Mr.  Digby  in  his  monumental 
work  ironically  called  "  Prosperous  British  India." 
Particular  phases  have  been  dealt  with  by  Messrs. 
Hyndman,  Wilson  and  others  from  whom  I  have  pro- 
fusely quoted.  My  own  countrymen,  Messrs.  R.  C. 
Dutt  and  Naoroji,  have  done  valuable  work  in  this  line. 
The  works  of  the  former, — "  Early  History  of  British 
Rule,"  "  India  in  the  Victorian  Age,"  "  Famines  in 
India,"  and  "  England  and  India,"  published  by 
Messrs.  Kegan  Paul,  Trench,  Trubner  and  Co.,  of 
London,  are  monuments  of  his  industry,  research  and 
moderation.  Mr.  Naoroji's  "  Poverty  of  India  "  is  a 
collection  of  the  economic  writings  of  that  veteran 
Indian  nationalist  during  half  a  century  of  his  active 
political  life.  These  works  of  Messrs.  Digby,  Dutt 
and  Naoroji  must  for  a  long  time  continue  to  be  the 
classics  of  Indian  economics  and  no  student  of  the 
latter  can  afford  to  neglect  them.  My  obligations  to 
them  are  unlimited. 

I  have  made  free  use  of  the  books  of  Messrs.  Digby 
and  Dutt,  though  I  have  refrained  from  quoting  Mr. 
Dutt's  own  language.  At  one  time  I  thought  of  tak- 
ing up  the  subject,  from  where  they  had  left  it  in 
1901 ;  but  in  developing  my  ideas  I  decided  that  a 
change  of  arrangement  also  was  needed  to  bring  the 
matter  within  the  grasp  of  the  lay  reader.  Mr.  Dutt 
has  arranged  his  books  chronologically,  dealing  with 
the  same  matter  in  several  chapters,  scattered  all  over 

ii 


PREFACE 

the  two  volumes  of  his  "  Economic  History  of  British 
Rule."  I  have  tried  to  include  everything  relating  to 
one  subject  in  one  place,  thus  avoiding  repetitions 
otherwise  unavoidable.  For  example,  I  have  given 
a  complete  history  of  the  cotton  industry  from  the 
earliest  times  to  date  in  one  chapter  and  so  also  with 
shipping  and  shipbuilding.  Similarly  everything  re- 
lating to  drain  has  been  included  in  one  chapter  and 
so  on.  The  book  is  thus,  in  my  judgment,  an  improve- 
ment on  those  referred  to  above.  It  brings  the  whole 
subject  up  to  date  and  makes  it  easily  understandable 
by  the  ordinary  lay  reader.  I  would  like  to  have 
added  chapters  dealing  with  finance  and  currency, 
famine  insurance,  banking,  railway  rates,  etc.,  but  the 
size  which  I  fixed  for  this  volume  having  already  been 
exceeded,  I  must  reserve  these  subjects  for  another 
volume,  if  needed. 

There  is  talk  of  great  adjustments  being  made  in  the 
British  Empire,  after  the  war.  India  also  is  on  the 
tiptoe  of  expectations.  The  Jingo  Imperialists  in 
England  and  India  are  already  making  proposals 
which  if  accepted,  are  sure  to  cause  further  economic 
loss  to  India.  Some  want  India  to  take  over  a  part 
of  the  British  war  debt ;  others  are  looking  with  jealous 
eyes  at  India's  "  hoarded  wealth  " —  the  existence  of 
which  is  known  only  to  them.  What  will  happen  no 
one  can  foretell;  but  one  of  the  reasons  which  have 
impelled  the  writer^o  publish  this  volume  at  this 
juncture  is  to  remin3~the  Anglo-Saxon  public"~trow 
India  has  &6  far  f  aredeconomically  under  British  rule^ 
Any  Iresh  burden  niight  tendto  break  the  proverbial 
camel's  back.    We  know  that  the  English  will  do  what 

iii 


PREFACE 

they  please ;  yet  we  have  dared  to  say :  perchance  it 
may  fall  on  fruitful  ground.  The  book  is  not  written 
in  a  spirit  of  hostility  to  British  rule.  It  is  not  my 
object  to  irritate  or  to  excite.  What  I  aim  at  is  to 
give  matter  for  thought  and  reflectionand  to  siipply  3 
reason  for~the  exercise  ot  restraint  in  th'e~(3etermma- 
tioiTlxf  the  fiscal  poHcy  which  British  statesmen  may 
decide  lo^ToTTow  fowards'india  after  the  war".  Gieat- 
Britain  has  suffered  Jbuge^  losses  in  the  war.  As~soOn 
as  war  is  ended,  there  will  be  a  cry  to  make  them  up. 
N^O  other  part  of  the  Empire  offers  such_a__field  as 
India^!  She  has  the  largest  area  and  the  largest  popu- 
lation. She  has  no  voice  in  her  government  and  is 
helpless  To  make  herself  heard.  She  can  neither 
check  nor  retaliate.  What  can  be  easier  than  to  make 
her  pay  for  the  war  ?_  What  this  is  likely  to  mean  to 
India  may  be  gathered  from  this  volume.  What  feel- 
ing it  will  create  in  India  may  be  imagined.  ''The 
world  is  anxious  to  know  how  Great  Britain  is  going 
to  reward  India's  loyalty  and  devotion.  If  the  de- 
cision rests  with  men  of  the  type  of  Lord  Sydenham 
it  is  already  given.  He  recommends  the  immediate 
and  final  rejection  of  all  the  demands  made  by  India 
for  post-war  reforms  as  embodied  in  the  memoran- 
dum of  the  elected  members  of  the  Viceroy's  council. 
These  demands  are  extremely  moderate.  They  fall 
far  short  of  even  home  rule.  Their  rejection  will  be 
very  distressing  to  India.  We  hope  that  wiser  coun- 
sels will  prevail  and  the  statesmanship  of  T^ngland  will 
prove  that  India  did  not  pin  her  faith  to  British 
justice  in  vain.  India  has  stood  by  England  mag- 
nificently and  some  of  the  nationalist  leaders  have  had 

iv 


PREFACE 

a  hard  time  in  resisting  the  advances  made  by  the 
enemies  of  Great  Britain.  Let  us  hope  that  they  were 
not  labouring  under  vain  illusions  and  that  Great 
Britain  was  sincere  when  she  professed  to  stand  for 
right  and  justice  in  international  dealings.  In  the 
meantime  British  statesmen  are  very  assiduously  en- 
gaged in  impressing  on  the  neutral  world  that  India 
is  happy,  prosperous,  and  the  most  lightly  taxed 
country  on  earth. 

For  the  benefit  of  the  reader  I  reproduce  the  follow- 
ing interview  which  the  Finance  Minister  of  India  is 
said  to  have  given  to  a  correspondent  of  the  Associated 
Press : 

"  FINANCE  MINISTER  DENIES  THAT  INDIA  GROANS  UNDER 

TAX.      TOTAL   REVENUE,   DISTRIBUTED   AMONG 

244,000,000   PEOPLE,    SEVEN    SHILLINGS 

PER    CAPITA 

"Simla,  India,  Dec.  20.  (Mail  correspondence  to 
the  Associated  Press.) — So  far  from  the  people  of 
India  groaning  under  an  enormous  burden  of  taxation, 
India  is  one  of  the  most  lightly  taxed  countries  on  the 
face  of  the  earth,  according  to  Sir  William  Meyer, 
minister  of  finance  for  India,  in  response  to  the  charges 
of  over-taxation  preferred  by  so-called  extremists. 

"  The  total  revenues,  imperial  and  provincial,  for  the 
current  year,  during  which  some  additional  taxation 
was  imposed,  amounted  to  £86,500,000,  Sir  William 
said,  and  this  sum  distributed  among  the  244,000,000 
people  of  British  India  gave  a  resultant  contribution 
per  capita  of  only  seven  shillings.  He  pointed  out  that 
in  three  other  Asiatic  countries,  Japan,  Siam,  and  the 
Dutch  Indies,  the  rate  per  head  was  much  higher,  be- 
ing 27,  shillings  in  Japan,  13  shillings  4  pence  in  Siam 
and  II  shillings  3  pence  in  the  Dutch  Indies. 

"  The  finance  minister  said  the  land  revenue  has  been 


PREFACE 

one  of  the  points  upon  which  opponents  of  the  govern- 
ment have  been  most  bitter,  it  being  claimed  that  the 
farmer  was  kept  in  poverty  by  taxation.  Sir  William 
stated  that  of  the  total  revenue  of  £86,500,000  for  this 
year,  about  £22,000,000  was  derived  from  the  land, 
India  being  mainly  an  agricultural  country. 

STATE  TAKES   UNEARNED   INCREMENT 

"  According  to  immemorial  traditions  in  India  the 
state  has  always  claimed  a  share  in  the  produce  of 
the  soil,  he  continued.  At  the  close  of  the  eighteenth 
century  the  state  share  was  commuted  for  a  fixed 
money  payment  in  various  tracts,  mostly  in  Bengal,  but 
over  the  greater  part  of  India  we  revise  the  money 
value  of  that  share  every  30  years  or  so  with  reference 
to  the  increase,  or  possible  decrease,  if  that  should 
occur,  in  the  value  of  the  agricultural  produce.  The 
state  thus  takes  to  itself  a  share  of  what  is  known 
to  economists  as  the  unearned  increment,  a  policy  that 
ought  to  find  favour  with  enlightened  socialists.  Theo- 
retically, after  making  liberal  allowance  for  cultivation 
expenses,  the  state  share  is  one-half  of  the  resultant 
net  profit,  but  as  a  matter  of  fact  our  recent  settlements 
have  been  in  practice  much  more  lenient  than  this,  and 
the  amount  we  take  is  much  less  than  was  exacted 
by  previous  native  rulers.  Liberal  remissions  are  also 
given  when  crops  suffer  from  drought,  flood  or  other 
calamities." 

Let  the  reader  study  this  pronouncement  in  the 
light  of  the  facts  disclosed  in  this  volume.  We  will 
not  forestall  his  judgment  nor  point  out  to  him  the  mis- 
statements with  which  the  interview  bristles.  Let  him 
only,  judge  of  a  statesman,  giving  the  incidence  of 
taxation  without  stating  the  figure  of  income.  The 
burden  of  taxation  always  goes  with  the  capacity  to 
pay.     If  a  man  earning  $10  a  year  pays  about  $2  (7s.) 

vi 


PREFACE 

in  taxes  can  he  be  said  to  be  the  most  lightly  taxed 
person  in  the  world?  Yet  it  was  only  last  year  that 
this  finance  minister  added  to  the  burden  of  taxation 
and  raised  the  tax  on  one  of  the  great  necessities  of 
life  —  salt.  This  he  did  in  spite  of  the  universal 
opposition  of  the  country  and  the  results  as  reported 
by  the  press  are  most  disheartening.  The  price  of 
salt  has  risen  considerably  beyond  the  means  of  the 
people  to  pay,  and  there  is  a  general  cry  of  pain. 

Will  the  people  of  England,  with^wjigjmjheji^^ 
responsibility  for  the  gav£rmnent.M 
"up  and  compel  their  statesmen  to  put  into  practice  the_ 
principles  for  which  they  say  they  hjA^^been  fighting 
this  war? We  will  wait  and  see. 

T~fender'  fri'y 'acl<nbwledgments  to  the  numerous 
writers  whom  I  have  quoted  as  also  to  the  publishers 
of  books  and  magazines  referred  to  by  me.  The 
manuscript  has  been  very  kindly  read  for  me  by 
Professors  E.  R.  A.  Seligman  and  H.  R.  Mussey  of 
Columbia  University,  New  York,  as  also  by  my 
friend  Dr.  Sunderland.  Professor  H.  R.  Mussey  has 
also  read  the  proofs.  My  acknowledgments  are  due 
to  them  for  valuable  suggestions.  The  writing  of 
this  book  has  been  made  possible  only  by  the  courtesy 
of  the  librarians  of  Columbia  University,  whose  uni- 
form kindness  I  cannot  sufficiently  admire. 

La  J  PAT  Rai. 

New  York, 

loth  February,  19 17. 


vn 


A  WORD  ON  REFERENCES 

It  will  be  observed  that  no  uniformity  has  been 
maintained  in  the  spelling  of  Indian  names.  The  rea- 
son is  that  we  have  not  altered  the  original  spellings 
of  the  different  quotations  given.  With  regard  to  the 
following  names,  use  of  a  single  work  is  indicated 
when  the  author's  name  is  used  instead  of  the  work 
by  title. 

Mill  always  means  "  The  History  of  British 
India,"  by  Jan^es  Mill. 

Torrens  always  means  "  Empire  in  Asia,"  by 
W.  M.  Torrens,  M.P. 

Thorborn  always  means  "  The  Punjab  in  War  and 
Peace,"  by  S.  S.  Thorburn. 

Blunt  always  means  "  India  under  Ripon,"  by 
Wilfred  Scawen  Blunt. 

Loveday  always  means  "  The  History  and  Eco- 
nomics of  Indian  Famines,"  by  A.  Loveday. 

Morison  always  means  "  Economic  Transition  in 
India,"  by  Sir  Theodore  Morison. 

Baines  always  means  "  Baines'  History  of  Cotton 
Manufacture." 

It  may  be  stated  generally  that  italics  in  quotations 
from  other  authors  are  ours  unless  the  context  shows 
otherwise. 

With  regard  to  Indian  currency,  it  must  be  kept  in 
mind  that  a  rupee  consists  of  i6  annas,  an  anna  being 
equivalent  to  an  English  penny  or  two  cents  in  Ameri- 
can money.  Three  rupees  are  thus  approximately  a 
dollar  in  American  money,  and  fifteen  rupees  make 
one  English  pound  sterling. 


POST-SCRIPTUM 

India's  "  Gift "  of  One  Hundred  Million  Pounds  to 
England.  Since  the  above  was  put  in  type  our  worst 
fears  have  come  to  be  true.  The  British  Government 
of  India  has  decided,  with  the  sanction  of  the  Sec- 
retary of  State  for  India,  to  float  a  war  loan  in  India 
of  an  unlimited  amount.  The  idea  is  to  make  a 
"  gift "  of  iioo,ooo,ooo  (or  $500,000,000)  to  the  Brit- 
ish Exchequer.  The  amount  of  the  loan,  or  as  much 
as  is  raised,  will  be  made  over  to  the  Government  of 
Great  Britain  and  liability  for  the  rest  will  be  ac- 
cepted by  the  Government  of  India.  The  British 
Cabinet  have,  with  the  sanction  of  the  House  of  Com- 
mons, accepted  this  "  gift "  and  in  lieu  thereof  al- 
lowed the  Indian  Government  to  raise  their  customs 
duty  on  the  imports  of  cotton  goods  by  four  per  cent, 
ad  valorem.  This  transaction  involves  an  additional 
burden  of  £6,000,000  a  year  (or  $30,000,000)  on  the 
Indian  tax  payer.  It  is  expected  that  out  of  this 
some  i 1, 000,000  will  be  recovered  by  the  additional 
duty  on  cotton  imports  and  the  rest  will  be  raised  by 
additional  taxation. 

The  British  statesmen  have  called  it  "  a  free  gift  of 
the  people  of  India  "  and  have  thanked  the  latter  for 
their  "generosity."  The  fact  is  that  the  people  of 
India  or  their  representatives  in  the  Legislative  Council 
were  never  consulted  about  it.    The  transaction  was 

ix 


POST-SCRIPTUM 

settled  between  the  Government  of  India  and  the  Sec- 
retary of  State  for  India,  at  Whitehall  and  then  an- 
nounced to  the  Indian  Legislature  as  a  decision.  The 
Manchester  Guardian  and  the  London  Nation  have 
exposed  it  in  its  true  colours.  The  former  says,  in  its 
issue  of  March  15th: 

"  The  great  services  which  Indian  manhood  and  In- 
dian production  have  rendered  in  this  war  we  all  grate- 
fully acknowledge.  But  their  very  magnitude  is  an 
argument  against  the  wisdom  and  justice  of  adding  to 
them  a  contribution  in  money  and  in  financing  that 
contribution  mainly  at  the  expense  of  the  poor  who 
have  already  made  the  greatest  sacrifices.  Mr.  Cham- 
berlain [the  Secretary  of  State  for  India]  says  that 
the  assumption  of  the  £100,000,000  loan  was  a  free 
will  offering  coupled  with  the  condition  that  the 
Indian  cotton  trade  should  be  given  protection.  Mr. 
Chamberlain  obscures  one  not  unimportant  circum- 
stance. It  is  we  who  govern  India  and  not  the  Indian 
people.  The  initiative  in  all  financial  proposals  neces- 
sarily comes  from  the  government  we  appoint  in  India 
and  cannot  reach  the  light  of  public  discussion  in  the 
Legislative  Council  or  elsewhere  until  they  have  re- 
ceived the  sanction  of  the  Secretary  of  State  here. 
For  Mr.  Chamberlain  to  throw  upon  the  people  of 
India  the  responsibility  for  originating  and  devising 
the  £100,000,000  contribution  and  the  protective  duties 
which  have  been  coupled  with  it,  is  as  unconvincing 
a  rhetorical  exercise  as  the  House  of  Commons  has 
witnessed  for  many  a  long  day.  The  responsibility 
for  the  whole  scheme  from  the  first  to  the  last  is  his 
and  that  of  the  Indian  Government.  We  have  said 
more  than  once  and  we  repeat  it,  that  in  our  opinion  a 
wise  statesmanship  would  both  find  better  use  in  India 
for  India's  millions  and  employ  India  more  advanta- 
geously for  the  common  cause  by  using  more  of  her 
manhood  and  less  of  her  money." 


POST-SCRIPTUM 

In  a  previous  issue  of  the  same  paper  it  was  ob- 
served : 

"  Why  was  the  matter  of  a  financial  contribution 
from  India  raised  now?  For  our  own  part  we  have 
the  gravest  doubts  as  to  the  wisdom  or  justice  of  tak- 
ing any  financial  contribution  from  India.  We  believe 
that  this  is  not  the  best  way  for  India  and  the  Empire, 
in  which  India  can  serve  the  common  cause  and  the 
loss  it  represents  to  an  extremely  poor  population  like 
that  of  India  is  very  much  greater  than  the  gain  it  rep- 
resents to  England.  If  we  really  are  seriously  con- 
cerned that  India  should  develop  in  every  way  the  vast 
potentialities  of  her  indigenous  industries  it  would  be 
better  to  spend  that  i  100,000,000  on  developing  her  re- 
sources than  to  take  that  money  from  India  and  in 
exchange  give  Bombay  a  tariff." 

The  London  Nation  in  its  issue  of  March  17th  says : 
"  The  people  of  India  have  no  voice  in  this  or  any 
other  act  of  Government,  and,  if  they  had,  they  would 
be  forced  to  think  twice  before  contributing  out  of 
their  dire  poverty  [the  italics  are  ours]  this  huge  sum 
of  a  hundred  millions  to  the  resources  of  their  wealthy 
rulers.  Nor  ought  a  poor  subject  people  already  bur- 
dened with  large  increases  of  war  taxation  to  be  com- 
pelled by  its  Government  to  make  this  gift."  Further 
on,  the  Nation  characterises  the  whole  transaction  as 
one  of  "  sheer  dishonesty  "  and  adds :  "  India  is  not 
self-governing  and  this  particular  action  is  not  the 
action  of  a  body  justly  claiming  to  represent  the  will 
or  interests  of  the  Indian  people.  It  is  the  arbitrary 
action  of  a  little  group  of  officials  conniving  with  a 
little  group  of  prosperous  business  men  and  playing  on 
the   mistaken   economic  nationalism   of   a   somewhat 


POST-SCRIPTUM 

larger  number  of  educated  natives.     It  is  a  bad  and  a 
foolish  game." 

The  writer  of  "  a  London  Diary  "  column  in  the 
Nation  described  it  as  "  merely  a  case  of  one  official  in 
India  signalling  to  another  in  England." 

The  Viceroy  of  India,  making  his  final  speech  on 
the  Budget,  remarked  that  the  Budget  will  involve  "  a 
sacrifice  in  a  large  measure  of  the  necessities  of  or- 
dered Government "  and  that  "  one  result  must  be  the 
arrested  progress  in  education,  in  sanitation,  in  public 
works  and  kindred  subjects  which  are  in  other  coun- 
tries the  touchstone  of  civilised  life."  What  this 
means  in  the  case  of  India,  will  be  made  clear  in  the 
following  pages. 

As  to  how  much  India  has  done  for  England  during 
this  war  we  beg  to  refer  the  reader  to  an  article 
written  by  Mr.  Yusaf  Ali,  a  retired  Indian  civil 
servant  in  the  Nineteenth  Century  and  After  for  Feb- 
ruary 8,  1917,  from  which  we  give  a  few  extracts  in 
an  appendix.  Discussing  the  economic  eflfect  of  the 
war  on  India  Mr.  Ali  remarks:  "  In  1915,  the  prices 
broke  famine  records."    And  again : 

"  In  India,  unfortunately,  on  account  of  the  war,  the 
isolation  of  the  country,  and  the  local  crop  having  been 
short  by  17^%,  the  price  was  very  high.  .  .  .  The 
question  of  high  food  prices  in  India  affects  very  ma- 
terially her  further  capacity  for  taxation  or  for  having 
further  financial  burdens.  The  small  average  individ- 
ual income  of  India  is  mainly  spent  on  the  barest  ne- 
cessities of  life.  When  the  necessities  rise  over  100%, 
it  does  not  mean  an  inconvenience;  it  means  loss  of 
vitality  and  efficiency." 

According  to  this  writer,  "  The  services  of  India  are 
xii 


POST-SCRIPTUM 

estimated  at  a  value  of  $240,000,000  for  the  two  and 
a  half  years  that  the  war  will  have  lasted  at  the  close 
of  the  present  financial  year."  Calculating  the  pre- 
war insurance,  afforded  by  India's  expenditure  on  the 
army  of  £14,000,000  (or  $70,000,000)  a  year,  at  fif- 
teen years'  purchase  he  fixes  its  value  to  the  Empire  at 
£210,000,000,  or  $1,050,000,000.  He  also  explains 
how  India  has  helped  the  Imperial  authorities  by  vari- 
ous other  financial  measures  and  by  a  war  loan  of 
£4,500,000  and  concludes :  "  The  fact  is  that  India, 
so  far  from  having  superfluous  capital,  was  and 
is  urgently  in  need  of  capital,  and  the  launching  of  a 
more  ambitious  scheme  must  hinder,  instead  of  help- 
ing, the  cause  which  India  is  upholding  with  so  much 
self-sacrifice." 

Evidently  the  raising  of  this  new  loan  of  $500,000,- 
000  was  in  the  air  when  he  wrote  the  article  and 
Mr.  Yusaf  AH,  who  is  permanently  settled  in  London, 
with  his  English  wife,  thought  it  was  his  duty  to  raise 
a  voice  of  protest.  The  fact  that  the  article  was  pub- 
lished in  the  Nineteenth  Century  and  After  shows  the 
high  esteem  in  which  the  writer  is  held  in  journalistic 
circles  in  England.  Mr.  Yusaf  Ali  has  never  identified 
himself  with  the  Nationalistic  party  and  his  views  are 
those  of  a  loyaHst  whose  loyalty  does  not  necessarily 
mean  his  supporting  everything,  just  or  unjust,  which 
the  Government  does.  His  protest,  however,  proved 
to  be  a  cry  in  the  wilderness. 

In  this  connection  it  might  be  of  interest  to  add 
the  following  extract  from  the  Proceedings  of  the 
Government  of  India,  in  the  Legislative  Department: 
**  Replying  to  the  Hon.  Maharaja  Manindra  Chandra 

xiii 


POST-SCRIPTUM 

Nandi's  question  regarding  contributions  to  the  war 
by  Indian  Native  States  and  Indian  Provinces  the 
Hon.  Sir  Reginald  Craddock  said :  '  Complete  or  de- 
tailed figures  of  the  amounts  subscribed  in  all  the 
Provinces  of  India  towards  the  war  and  the  charities 
connected  with  it,  cannot  be  given.  The  statement 
given  below  gives  such  information  as  is  immediately 
available.'  "  Then  follow  the  details  of  sums  given, 
aggregating  £2,047,375.  "  In  addition  to  the  figures 
given  in  the  statement,  lavish  contributions  both  in 
cash  and  kind  have  been  made  by  the  ruling  Princes 
and  Chiefs  in  India.  It  is  regretted  that  details  of 
these  cannot  conveniently  be  supplied." 

All  these  "  lavish "  contributions,  however,  failed 
to  satisfy  the  British  and  the  Government  did  not 
scruple  to  load  an  additional  burden  of  $500,000,000  on 
the  already  crushed  shoulders  of  the  Indian  ryot. 

Indian  opinion,  rather  timidly  expressed,  may  be 
gathered  from  the  following  report  of  a  speech  made 
by  a  Hindu  member  of  the  Viceroy's  Legislative  Coun- 
cil, on  the  occasion  of  the  discussion,  on  the  cur- 
rent year's  Budget.  Said  the  Hon.  Mr.  Rangaswami 
Iyengar :  "  My  Lord,  the  provision  of  a  hundred 
millions  sterling  together  with  its  interest,  which 
amounts  nearly  to  double  the  gift  towards  the  war  ex- 
penditure of  the  Empire,  is  undoubtedly  the  most 
prominent  feature  of  the  budget  of  this  year.  Apart 
from  the  consideration,  as  has  been  pointed  out  by  our 
esteemed  colleague,  the  Hon.  Pandit  Madan  Mohan 
Malaviya,  of  neglecting  to  take  this  Council  into  con- 
fidence before  the  contribution  was  made,  the  burden- 
ing to  the  breaking  point  of  a  country,  whose  poor  peo- 

xiv 


POST-SCRIPTUM 

pie  are  already  suffering  owing  to  results  of  a  peculiar 
economic  policy  of  the  Government  of  India,  without 
leaving  a  margin  for  emergencies,  should  furnish  an 
insoluble  problem  to  the  statesman.  .  .  . 

"  In  this  connection  it  has  to  be  pointed  out,  especially 
in  view  of  the  unmerited  complaints  brought  against 
India  in  certain  Anglo-Indian  organs,  that  even  with- 
out this  huge  contribution  India  has  borne  more  than 
her  own  fair  share  as  compared  with  other  parts  of 
the  Empire  from  the  services  already  rendered  by  her 
in  her  sacrifice  of  men  and  money. 

"  Here  is  a  statement  as  regards  the  help  in  men 
alone  until  the  end  of  1916: 

I :     Four  expeditionary   forces . . .      300,000 

2:     Wastage  and  renewal 450,000 

3 :    Transport,  Marine,  etc 50,000 

800,000 
Increase  in  units  since  war 300,000 

To  end  of  1916 1,100,000 

"  All  these  men  have  been  trained  in  India  and  not  in 
Salisbury  as  was  the  case  with  the  Colonials. 

"  Again,  coming  to  contributions  in  money  till  1916 : 
Military  stores,  services,  and  supplies. . . .  £50,000,000 
Advanced  to  Britain  from  Reserves,  etc..  27,000,000 
Deduct  loans  from  Britain Nil 

Total     £77,000,000 

"  Whereas  the  help  the  Colonies  rendered  in  this  di- 
rection partook  mostly  of  the  nature  of  loans.  I  chal- 
lenge if  any  Colonies  peopled  with  richer  classes  have 

XV 


POST-SCRIPTUM 

made  a  similar  sacrifice.  Is  it  fair  to  strain  the  re- 
sources further  ?  " 

How  these  financial  exactions  are  likely  to  cripple 
India,  where  millions  have  died  from  famine  within 
the  last  fifty  years ;  where  within  the  last  twenty 
years,  millions  have  died  from  plague,  where  even  now 
thousands  die  every  week  from  the  same  fell  disease 
and  where  the  vast  bulk  of  the  people  are  illiterate  and 
so  abjectly  poor,  as  to  excite  pity  even  from  the  stone- 
hearted,  may  better  be  imagined  than  described. 

For  the  latest  testimony  to  this  effect  we  may  cite 
from  an  article  that  has  appeared  in  The  Quarterly 
Review  (British)  for  April,  1917,  over  the  signature 
of  Mr.  W.  H.  Moreland,  C.  S.  L,  C.  I.  E. 

"  It  is  a  matter  of  common  knowledge  that  the 
standard  of  life  in  India  is  undesirably  low ;  that  while 
the  masses  of  the  people  are  provided  with  the  neces- 
sities of  a  bare  existence  they  are  in  far  too  many  cases 
badly  housed  and  badly  clothed,  badly  doctored  and 
badly  taught,  often  overworked  and  often  underfed; 
and  that  the  present  income  of  the  country,  even  if  it 
were  equitably  distributed,  would  not  suffice  to  provide 
the  population  with  even  the  most  indispensable  ele- 
ments of  a  reasonable  life." 

Finally  it  may  be  noted  that  the  Indian  Budget  for 
military  expenditure  has,   in  the   current  year,  been 
raised  to  £26,000,000  while  before  the   war  it  was 
only    i20,ooo,ooo.     Besides    troops    fighting    in    the 
trenches,  India  has  also  supplied  England  with  the 
following  medical  equipment: 
40    Field  Ambulances 
6  Clearing  Hospitals 
35  Stationary  Hospitals 
xvi 


POST-SCRIPTUM 

1 8  General  Hospitals 
9  ;r-ray  Sections 
8  Sanitary  Sections 
7  Advanced  Depots 
I  General  Medical  Store  Depot 

About  2,2^2"]  doctors  and  nurses,  and  about  720 
nursing  orderlies. 

These  figures  are  taken  from  the  speech  which  the 
Secretary  of  State  for  India  made  in  the  House  of 
Commons  in  March,  1917.  He  also  made  mention 
of  the  fact  that  India  had  supplied  about  20,000  camp 
followers.  The  Government  of  India  is  at  the  pres- 
ent moment  engaged  in  raising  a  "  labour  "  army  in 
India  for  work  in  England  and  in  other  places.  Let 
those,  who  have  been  talking  so  much  of  how  England 
has  protected  India,  take  into  consideration  these  facts 
as  well  as  those  given  in  the  body  of  the  book,  and  then 
say  honestly,  who  has  been  the  greater  gainer  by  this 
connection.  India  can  await  patiently  and  securely 
the  verdict  of  posterity  on  this  point. 

Recent  Happenings  in  England.  Rain  of  Words. 
In  the  meantime  things  have  happened  in  England 
which  we  cannot  omit  noticing  in  connection  with  the 
main  theme  of  this  book.  The  meetings  of  the  Impe- 
rial War  Conference  in  March ;  the  participation  in  it 
for  the  first  time  of  delegates  from  India ;  the  courte- 
sies extended  to  the  latter  and  the  honours  conferred  on 
them  by  the  various  public  bodies  of  the  British  Isles, 
including  the  conferring  upon  the  delegates  of  the 
freedom  of  the  cities  of  London,  Manchester,  Edin- 
burgh and  Cardiflf,  and  the  honourary  degrees  of 
some  of  the  universities,  have  furnished  opportunities 

xvii 


POST-SCRIPTUM 

for  some  pleasant  talk  on  both  sides  which,  judged  by 
standards  of  sweetness,  politeness  and  occasional  frank- 
ness, is  refreshing.  For  the  first  time  since  the  British 
connection  with  India  were  the  Indian  delegates  al- 
lowed to  participate  in  the  deliberations  of  an  Imperial 
Conference ;  for  the  first  time  they  were  considered 
worthy  of  being  honoured  with  the  freedom  of  British 
cities.  For  the  first  time  it  was  conceded  that  India 
might  look  forward  to  a  day  when  she  may  be  treated 
as  a  partner  in  the  Empire,  and  not  as  a  hewer  of 
wood  or  drawer  of  water  for  the  latter.  Reading 
the  speeches  and  assuming  the  honesty  and  sincerity 
of  the  speakers,  an  Indian  may  take  comfort  in  the 
hope  that  a  day  of  real  freedom  was  dawning  upon  his 
unfortunate  country,  and  that  this  time  at  least,  the 
British  meant  what  they  said. 

If  words  of  sympathy,  promises  of  a  future  state  of 
autonomy,  compliments  and  acknowledgments  could 
bring  happiness  and  prosperity  to  the  millions  of  India, 
she  has  had  a  copious  outburst  of  them  within  the  last 
two  months  and  a  half,  nay  in  fact,  from  the  very 
beginning  of  the  war.  If,  however,  the  value  of 
words  is  to  be  judged  by  deeds,  an  Indian  may  still  be 
pessimistic  about  actual  realisations. 

"  Sweet  words  are  now  raining  upon  India,"  re- 
marks the  Investor's  Review,  London  (April  28,  1917), 
"  and  we  trust  foreshadow  generous  deeds."  Do  they  ? 
is  the  question. 

India  would  be  content  if  even  half  of  what  has  been 
said  were  realised  in  the  near  future.  The  actual  be- 
haviour of  the  Government  in  India  and  in  England, 
however,  is  not  at  all  encouraging.    The  restrictions 

xviii 


POST-SCRIPTUM 

on  the  freedom  of  speech  and  the  freedom  of  meeting 
have  not  been  relaxed  in  the  least.  In  one  province, 
alone,  800  young  Indians  are  rotting  in  jails  without 
ever  having  had  a  chance  of  being  tried  for  their  sup- 
posed offences.  The  inequalities  in  the  public  serv- 
ices, civil  and  military,  have  not  been  removed.  The 
appointments  to  the  executive  offices  both  in  India  and 
in  England  are  of  the  most  reactionary  type.  The  so- 
licitations of  the  Indian  Nationalists  to  get  larger 
appropriations  for  education  and  sanitation  are  still  un- 
heeded. The  only  thing  actually  done  is  the  increase 
in  the  cotton  duties,  of  which  we  have  spoken  above. 

The  Speeches  of  the  Maharaja  of  Bikanir.  The 
Position  of  Indian  Princes.  The  speeches  of  the  Ma- 
haraja of  Bikanir  and  of  Sir  S,  P.  Sinha,  the  Indian 
delegates  to  the  Imperial  War  Conference,  have  done 
at  least  one  good.  They  have  cleared  the  atmosphere 
somewhat.  The  Maharaja  has  made  it  absolutely 
clear  that  the  ruling  princes  of  India  are  in  full  accord 
with  the  people  of  India  in  demanding  self-govern- 
ment, and  fiscal  autonomy.  In  the  words  of  the  In- 
vestor's Review,  "  The  Maharaja  impressively  pointed 
out  that  far  from  being  alarmed  at  the  political  prog- 
ress of  India,  the  ruling  princes  of  India  rejoice  in  it. 
At  least  10  per  cent,  of  the  more  important  states  al- 
ready have  representative  self-government,  and  every 
year  the  constitutional  government  is  being  extended. 
Though  '  autocrats,'  the  princes  of  India  are  march- 
ing with  the  times.  If  they  are  of  that  mind,"  asks 
the  Investor's  Reviezv,  "  why  should  we  hesitate  ?  " 

Those  who  read  the  speeches  made  by  the  Indian 
delegates  to  the  Imperial  War  Conference  in  London, 

xix 


POST-SCRIPTUM 

should  bear  in  mind  that  neither  of  them  were  the 
spokesmen  of  the  Indian  NationaHst  Party.  One  of 
them,  Sir  S.  P.  Sinha,  did,  no  doubt,  preside  at  an 
annual  meeting  of  the  Indian  National  Congress  in 
191 5,  but  that  was  his  only  connection  (first  and  last) 
with  the  movement.  Before  his  election  to  the  office 
of  president  of  that  session,  he  was  a  government  man, 
and  soon  after  he  again  became  a  government  man. 
He  is  an  official  of  the  Government  of  India  and  owes 
his  prosperity,  his  rank  and  his  wealth  to  the  Govern- 
ment. 

The  Maharaja  of  Bikanir  comes  from  an  ancient 
royal  family  of  India,  though  the  state  over  which  he 
rules  is  not  a  first-class  principality.  By  heredity,  in- 
stinct, and  tradition  he  is  an  autocrat.  For  his  ele- 
vation to  the  present  position  of  prominence  in  Indian 
political  life,  he  is  under  obligations  to  the  British 
Government  of  India.  He  comes  from  a  family 
which  has,  for  the  last  four  hundred  years,  kept  well 
with  the  paramount  authority,  Mughal  or  British, 
Personally  he  is  an  enlightened  and  progressive  ruler. 
Under  these  circumstances,  he  has  rendered  signal 
service  to  the  cause  of  his  country,  worthy  of  the 
great  ancestry  from  which  he  has  sprung,  in  making 
some  fairly  bold  and  outspoken  utterances  about  the 
aspirations  of  India.  At  last,  in  him,  the  princes  of 
India  have  found  a  worthy  representative,  and  the 
people  of  India  a  sincere,  though  by  the  limitations  of 
his  position,  a  rather  halting  champion  of  their  rights. 
Speaking  at  the  luncheon  given  by  the  Empire  Par- 
liamentary Association,  he  said  that  the  unrest  that 
exists  in  India  is  of  two  kinds: 

XX 


POST-SCRIPTUM 

"  That  which  the  seditionists  attempt  to  spread,  hap- 
pily with  small  results,  has  to  be  faced  and  is  being 
faced  and  suitably  tackled  by  the  authorities,  and  it  is 
our  earnest  hope  that  it  may  be  possible  gradually  to 
eradicate  the  evil,  which  is  a  cancerous  growth,  not, 
however,  peculiar  to  India.  The  other  kind  of  unrest 
is  what  has  been  happily  described  by  a  British  states- 
man as  '  legitimate.'  It  is  in  the  minds  of  people  who 
are  as  loyal  as  you  or  I.  (Hear,  hear.)  I  decline  to 
believe  that  British  statesmanship  will  not  rise  to  the 
occasion,  and  it  depends  on  whether  Indian  problems 
are  or  are  not  handled  with  sympathy,  with  imagina- 
tion, with  broad-minded  perspicacity,  that  that  legiti- 
mate unrest  will  die  out  or  continue.  It  is  the  strong 
opinion  of  many  who  have  given  the  subject  thought 
that  if  the  people  of  India  were  given  a  greater  voice 
and  power  in  directions  in  which  they  have  shown 
their  fitness  we  should  hear  much  less  of  the  unrest, 
agitation,  and  irresponsible  criticism  which  is  certainly 
gaining  ground.  Desperation  would  give  way  to  pa- 
tience, for  India  has  confidence  in  the  word  and  good 
faith  of  England,  and  the  enemies  of  order  and 
good  government  would  be  foiled.  The  '  unchanging 
East '  is  changing  very  rapidly  and  beyond  concep- 
tion."    (Report  in  the  Daily  Telegraph,  London.) 

The  speech  has  evoked  some  pertinent  comments  in 
the  British  press.  The  Daily  Telegraph  remarks 
(April  25,  1917)  : 

"  Every  one  is  aware  that  at  the  conclusion  of  the 
war  not  only  India  expects,  but  the  majority  of  us  at 
home  also  look  forward  to  a  considerable  development 
along  the  lines  of  political  reform." 

The  Prime  Minister's  Pronouncement.  The  clear- 
est pronouncement,  however,  is  that  of  the  Prime 
Minister,  who  in  the  speech  delivered  at  the  Guildhall 
on  April  27,  said  vv-ith  reference  to  India:     "  I  think  I 

xxi 


POST-SCRIPTUM 

am  entitled  to  ask  that  these  loyal  myriads  should  feel, 
not  as  if  they  were  a  subject  race  in  the  Empire,  but 
partners  with  us."  "  These  are  heartening  words," 
says  the  London  organ  of  the  Indian  Congress.  "  It 
remains  to  follow  them  by  deeds."  "  Unhappily,"  re- 
marks the  same  paper  (April  ^.y^,  "  those  who  monop- 
olise place  and  power  in  India  have  still  to  be  con- 
verted. There  is  copious  talk  of  the  *  new  angle  of 
vision,'  but  precious  little  indication  of  any  real  inten- 
tion to  quicken  the  rate  of  progress.  It  is  idle,  and 
also  insincere  to  profess  anxiety  to  help  Indians  along 
the  road  to  self-government  if  the  whip  hand  is  per- 
petually to  be  held  over  them." 

Coming  to  the  economic  side  of  the  question,  we 
observe  that  there  is  a  great  deal  of  hazy  talk  of  the 
future  economic  development  of  India.  Most  of  the 
papers  and  the  Under  Secretary  of  State  for  India, 
still  think  of  India  as  a  supplier  of  raw  materials  to 
the  Empire.  In  fact,  one  paper  (The  Contract  Jour- 
nal) holds  out  prospects  of  exploitation  to  the  British 
investor;  on  the  other  hand,  the  Stock  Exchange 
Gazette  and  The  Investor's  Review  are  happy  over  the 
prospects  of  the  development  of  Indian  powers  of  self- 
government.  The  most  authoritative  pronouncements, 
however,  in  the  matter,  are  those  of  Mr.  Austen  Cham- 
berlain, the  Secretary  of  State  for  India.  Speaking 
at  a  luncheon  given  by  the  chairman  of  the  East  India 
section  of  the  London  Chamber  of  Commerce,  he  said 
that  the  development  of  India  was  not  only  an  eco- 
nomic, but  a  political  necessity  of  the  first  consequence. 
Even  more  pronounced  and  significant  is  the  speech 
which  he  delivered  at  the  Savoy  Hotel  on  March  29, 

xxii 


POST-SCRIPTUM 

in  which  he  is  reported  to  "have  said  that  India  would 
not  remain  and  ought  not  to  remain  content  to  be  a 
hewer  of  wood  and  a  drawer  of  water  for  the  rest 
of  the  Empire.  It  was  essential  to  her  sound  and 
healthy  development  that  her  own  industries  should 
progress!  We  hope  Mr.  Chamberlain  is  sincere  and 
earnest. 

It  has  since  been  given  out  that  in  future  an  Indian 
will  represent  India  in  the  Imperial  War  Cabinet. 
An  Indian  nominated  by  the  British  Government, 
however,  could  not  represent  India  in  the  same  sense 
as  the  premiers  of  the  dominions  would  represent  the 
latter.  The  concessions,  though  important  in  appear- 
ance, are  thus  shadowy  in  effect.  Similarly,  the  talk  of 
Trade  Preference  within  the  Empire  is  not  likely  to 
benefit  India. 

Says  India,  the  organ  of  the  Indian  Congress  in 
London,  "  Mr.  Bonar  Law  informed  the  House  of 
Commons  on  Friday  last  that  the  Imperial  War  Cabi- 
net had  unanimously  accepted  the  principle  that  each 
part  of  the  Empire,  having  due  regard  to  the  interest 
of  our  Allies,  shall  give  specially  favourable  treat- 
ment and  facilities  to  the  produce  and  manufactures 
of  other  parts  of  the  Empire,"  that  "  there  is  no  in- 
tention whatever  of  making  any  change  during  the 
war."  Mr.  Lloyd  George  made  a  similar  announce- 
ment in  his  speech  in  the  city  on  the  same  day,  after 
the  usual  preliminary  denunciation  of  the  wickedness 
and  folly  of  adherence  to  old  party  systems  and  poli- 
cies. 

"  Nevertheless,  the  Prime  Minister  may  rest  assured 
that  India  intends  to  have  something  to  say  on  this 

xxiii 


POST-SCRIPTUM 

matter.  If  she  is  to  embark  upon  the  career  of  com- 
mercial development  which  is  being  so  confidently 
marked  out  for  her,  she  must  have  protection  for  her 
growing  industries :  and  her  most  formidable  competi- 
tor is  the  British  manufacturer.  The  application  of 
the  policy  of  Imperial  Preference,  which  is  now  fore- 
shadowed, will  simply  mean  that  India  must  take  Lan- 
cashire goods  at  Lancashire's  prices,  while  shutting 
out  Japan  and  the  United  States  from  her  markets. 
What,  then,  was  the  object  of  the  flourish  of  trumpets 
with  which  Mr.  Chamberlain  heralded  the  increase  in 
the  import  duties  on  cotton  goods?  Here  is  a  fiscal 
change  made  during  the  war  defended  on  the  ground 
that  it  is  consonant  with  Indian  opinion,  and  marked 
already  for  a  place  on  the  political  dust  heap  when  the 
war  is  over." 

Are  not  the  British  past  masters  in  the  art  of  taking 
away  with  the  left  what  they  give  by  the  right  hand? 

But  India  is  now  awake  and  will  not  be  fooled  as  she 
has  been  in  the  past. 

Lajpat  Rai. 
May  25,  1917, 
New  York  City. 


3CX1V 


CONTENTS 

Preface 

PART  I 

CHAPTER  PAGE 

I.    A  Historical  Retrospect 3 

India  Once  Was  Rich 3 

Thornton's  "Description  of  Ancient  India"      ...  4 

The  Golden  Age 4 

General  Condition  of  People  Under  Hindu  and  Mo- 
hammedan Rule 5 

India  Reform  Society  Pamphlet  Quoted       ....  6 

Torrens,  M.P.,  Compares  India  with  Europe  ...  9 

India  Under  the  Mohammedans 10 

Raid   of   Tamerlane 11 

From  1206  to  1526  A.  D 11 

Elphinstone  on  the  General  State  of  the  Country  .     .  12 

Caesar  Frederic  and  Ibn  Batuta     ........  12 

Abdurizag 12 

Baber 13 

Sher   Shah 13 

Akbar 14 

Pietro   del   Valle .  14 

Shah   Jehan        14 

Aurangzeb  and  His   Successors IS 

The  Raid  by  Nadir  Shah 15 

The  Pre-British  Period 16 

Principal  Political  Divisions  of  the  Country      ...  16 

Tanjore    and   Arcot 17 

Mysore        22 

Northern   India 24 

Bengal     ...     I.     ...........  25 

The  Kingdom  of  Oude 2y 


CONTENTS 

CHAPTER  PAGE 

Sevaji 29 

Anquetil  du   Perron 30 

Mahratta    administration      .........  31 

Malwa ,     .....  32 

Berar       ........     .     ,,    ..    .......  33 

Rampore 33 

Oude , 35 

Sattara 35 

Bengal   under  the   British 36 

Fisher  on  Native  States 39 

PART  II 

II.  India  and  the  British  Industrial  Revolution  .     .    43 

Before  Plassy 43 

Economic  Effects  of  Plassy 51 

Clive's   Second  Administration 59 

After    Clive 63 

III.  "Tribute"  or  "Drain" 69 

fT — General  Observations 69 

„ — Drain :  the  Case  Against  England 70 

^,^-^rain:  the  Case  for  England 79 

^,,^-Drain :  Weighing  the  Evidence 83 

,^.-The  Extent  of  the  Drain 91 

Figures 96 

IV     How  India  Has  Helped  England  Make  Her  Em- 
pire   103 

.^r-^ndia  and  "The  Empire" 103 

Foreign  Wars  Whose  Cost  Was  Charged  to  India.   105 

Lord  Lansdowne  on  the  Indian  Army 107 

Lord  Roberts  on  India  as  Training  Ground  for  British 

Army 108 

Sir  Henry  Brackenberry  on  Indian  Army  Expenditure  108 
Sir  Edwin  Collen  on  the  Apportionment  of  Expenses  109 
Lord  Northbrook  on  Wars  Outside  India  ....  109 
The  First  Treaty  with  Persia 112 


CONTENTS 

CHAPTER  PAGE 

Other  Nations  of  Asia ..,    ,     .     .114 

Isle  of  France iiS 

The  Muluccas 115 

Ceylon 115 

The  Eastern  Archipelago „    ...  115 

Siam  and  Cochin-China  .     .     .     .«..;.     .     .116 

Burmah        >........  116 

Malacca 116 

The  China  Consular  Representatives 117 

Aden        , 117 

The  Zanzibar  and  Mauritius  Cable ii7 

The  Red  Sea  Telegraph      ......    a    .     .     .117 

PART  III 

V.  The  Cotton  Industry  of  India 121 

Historical  Survey 121 

Early   Mention 121 

Excellence  of  Indian  Cotton  Fabrics 123 

Extent  of  the  Cotton  Industry  in  Olden  Times      .     .  124 

Decline  of  the   Indian   Industry 128 

Testimony  of  G.  G.  deH.  Larpent,  and  Other  Britishers  135 

Cotton  Goods 135 

Silk  Goods 135 

Testimony  of  Montgomery  Martin 138 

Cotton   Goods 138 

The    History   of    Import    Duties    and    the    Present 

state  of  the  Industry 141 

Legislative  Acts 141 

New  Factors  in  the  Situation  .     .        152 

Cotton  Duties  — 1917  Developments 159 

VI.  Shipbuilding,  Shipping,  and  Minor  Occupations  .  162 

Conditions   in   Former  Times 162 

The  Decline  of  the  Industry 167 

VII.  Miscellaneous     Industrial,     Agricultural,    and 

Mining   Operations 173 

Indigo     .     .     , 173 


CONTENTS 

CHAPTER  PAGE 

Jute 174 

Woollen  Mills 174 

Paper  Mills 175 

Breweries 175 

Rice  Mills  and  Saw  Mills 175 

Iron 175 

Copper 177 

Manganese 177 

Coal 178 

Other   Minerals 178 

Tea  and  Coffee 179 

VIII.  Agriculture 181 

India's  Greatest  Industry 181 

Land  Tax 188 

Revenue  Assessments  and  Incidence 189 

Bengal 193 

Madras 199 

Northern  India 216 

Bombay 225 

Village  Communities 225 

Changes  Under  British  Rule 228 

The   Punjab 235 

Central   Provinces 239 

The  Present  Policy  as  to  Land  Tax 240 

PART  IV 

IX.  Economic  Conditions  of  the  People 245 

_^The  Poverty  of  the  Masses 245 

Some  Results  of  Indian  Administration      ....  245 

Testimony  of  English  Public  Men 248 

Average  Income  of  the  People 250 

PART  V 

X.  Famines  and  Their  Causes 263 

Famines  in  the  Past 263 

Mr.  Digby's  Table  of  Famines      .     .     .    ;,:     .     .     .  264 


CONTENTS 

CHAPTER  PAGE 

Famines  in  the  Twentieth  Century 267 

^.^^amines  During  the  British  Period 268 

^J^uses  of  Famines 269 

-^^hortage  of  Rainfall 270 

Are  the  Famines  of  India  Due  to  Over-Population?  .  271 
Are  Famines  Due  to  Scarcity  of  Food?      ....  274 

Are  Famines  Due  to  Extravagances? 275 

-a — The  True  Cause 276 

Famine    Relief 277 

The  Building  of  Railways 278 

The  Building  of  Canals  and  Irrigation  Works  .     .     .  280 

Pressure  on  Land 281 

The  Opening  of  Agricultural  Banks 281 

Special  Agrarian  Legislation 282 

XL    Railways  and  Irrigation 283 

The  Government  Policy 283 

The  Beginning  of  Railway  Policy 285 

Benefits  of  Capital  Investment 297 

Irrigation 298 

XII.    Education  and  Literacy     ...,:,...  299 

Early   Conditions 299 

Facts  and  Figures  About  Education 300 

Law 301 

Medicine 301 

Engineering 302 

Agriculture        302 

Technical  and  Industrial  Education 303 

Commercial   Schools 305 

Art  Schools 305 

Education  of  Europeans 305 

Education  of  Girls 306 

^.JS^I.    Certain  Fallacies  About  the  "  Prosperity  of  In- 
dia "  Examined .  308 

XIV.    Taxes  and  Expenditure 314 

Abstract  of  Revenue  and  Expenditure 314 


CONTENTS 

CHAPTER  PAGE 

Ingenious  Way  of  Calculating  the  Burden  of  Taxa- 
tion     315 

The  Growth  of  Army  Expenditure 316 

The  Growth  of  Expenditure  on  Education  .     .     .     .317 

,^V.    Summary  and  Conclusion 319 

APPENDICES 

Appendix  A 

Extracts   from  an  Article  by  Mr.   Yusaf  Ali,  Nine- 
teenth Century  and  the  After  for  February,  1917  341 

Appendix  B 

Extracts  from  an  Article  from  the  Indian  Journal 
of  Economics  for  July,  1916 342 

Appendix  C 343 

Studies  in  Village  Economy  in  Madras 343 

Appendix  D 

Wages  in  India 346 

Appendix  E 

Comparative  Statement  of  Salaries  in  India  and  the 
United   States 35i 

Appendix  F 

Further   Notes 357 

Index 359 


PART  ONE 


"  We  are  accustomed  to  think  of  the  British  Empire 
as  consisting  mainly  of  men  of  Anglo-Saxon  blood,  and 
as  being  on  the  whole,  well-governed,  highly  civilised 
and  wealthy.  As  a  matter  of  fact,  the  Empire  con- 
sists of  Asiatics,  it  is  more  cursed  by  poverty  than  any 
other  great  state,  and  the  great  majority  of  its  adult 
population  are  unable  to  read  or  write.  The  first  and 
the  greatest  of  all  the  problems  of  Empire  is  the  prob- 
lem of  India.  Among  the  prominent  facts  with  re- 
gard to  India  which  are  confessed  in  statistical  ab- 
stracts, is  that  the  average  death-rate  for  the  ten  years 
ending  in  1908,  was  between  34  and  35  per  thousand; 
which  represents  an  excess  of  unnecessary  deaths, 
judging  by  the  standards  of  a  country  like  Japan,  of 
some  four  millions  per  annum. 

"Poverty  and  ignorance  are  the  obvious  causes  of 
this  appalling  death-rate.  The  fundamental  duty  of 
the  Government  is  to  protect  the  people  against  de- 
vastating plagues  and  famines ;  and  the  obvious  means 
of  doing  so  is  to  train  the  most  gifted  of  the  Native 
population  to  lead  the  people  in  the  fight  against  the 
evil  that  besets  them.  How  little  the  British  Govern- 
ment in  India  realises  this  duty  may  be  judged  by  the 
statistics  of  graduates  turned  out  in  the  year  1909-10, 
in  the  different  professions.  In  Medicine  there  were 
but  thirty, —  in  Engineering  only  seventeen, — in  Agri- 
culture not  a  single  one;  but  in  Arts  there  were  21 16 
and  in  Law,  576."  "  The  Making  of  Modern  Eng- 
land," by  Gilbert  Slater,  191 5,  page  276.* 

1  Italics  are  ours. 


ENGLAND'S  DEBT  TO  INDIA 

A  HISTORICAL  NARRATIVE  OF  BRITAIN'S 
FISCAL  POLICY  IN  INDIA 


CHAPTER  I 

A   HISTORICAL  RETROSPECT 

India  Once  Was  Rich.  It  is  almost  universally  ac- 
knowledged that  India  is  a  poor  country,  in  the  sense 
that  the  economic  condition  of  the  Tn^an  people  is  not 
good, —  their  average  income  being  (according  to  offi- 
cial calculation  made  in  1904,  during  the  viceroy alty 
of  Lord  Curzon)  only  £2,  or  $10.00  a  year.  But  such 
was  not  always  their  condition.  There  was  a  tirne 
when  India  was  rich^ — immensely  rich,  rich  jn  every- 
thing which  makes  a  country  great,  glorious  and  noble. 
Her  soris  and  daughters  were  distinguished  in  every 
walk  of  life.  She  produced  scholars,  thinkers,  divines, 
poets,  and  scientists,  whose  achievements  in  their  re- 
spective spheres  were  unique  in  their  own  times. 
Some  of  them  remain  unique  even  to-day.  Among 
her  children  were  sculptors,  architects,  and  painters 
whose  work  compels  admiration  and  exacts  the  praise 
of  the  most  exacting  art-critics  of  the  modern  world. 
Her  law-makers,  jurists,  and  sociologists  have  left  be- 
hind them  codes  and  ideas  of  justice  inferior  to  none 
produced  under  similar  conditions.,  -Under  their  own 

3 


4  ENGLAND'S  DEBT  TO  INDIA 

codes,  the  people  of  India  were  prosperous  and  happy. 

Thornton's  "  Description  of  Ancient  India." 
"  Ere  yet  the  Pyramids  looked  down  upon  the  valley 
of  the  Nile, —  when  Greece  and  Italy,  those  cradles  of 
European  civilisation,  nursed  only  the  tenants  of  a 
wilderness, —  India  was  the  seat  of  wealth  and  gran- 
deur. A  busy  population  had  covered  the  land  with 
the  marks  of  its  industry;  rich  crops  of  the  most 
coveted  productions  of  Nature  annually  rewarded  the 
toil  of  husbandmen;  skilful  artisans  converted  the 
rude  produce  of  the  soil  into  fabrics  of  unrivalled 
delicacy  and  beauty ;  and  architects  and  sculptors  joined 
in  constructing  works,  the  solidity  of  which  has  not,  in 
some  instances,  been  overcome  by  the  evolution  of 
thousands  of  years.  .  .  .  The  ancient  state  of  India 
must  have  been  one  of  extraordinary  magnificence," 

Such  is  the  picture  of  ancient  India  drawn  by  a  Brit- 
ish historian,  by  no  means  partial  to  India,  in  the 
opening  paragraphs  of  his  "  History  of  British  India." 
Sufficiency  with  Security  and  Independence  —  the 
Golden  Age.    This  estimate  of  the  magnificence  of 
ancient  India  is  not  merely  rhetorical.     That  the  India 
of  ancient  times  was  wealthy  and  prosperous  is  amply 
borne  out  by  incontestable  testimony.     Whether  the 
"  Golden   Age "   of   India   is   a  historical    fact   or  a 
myth   depends   upon   our  individvial  conception  of   a 
\J  golden  age, —  but  we  do  know  thatv^he  part  of  India  in- 
cluded in  the  Empire  of  Darius  (Afghanistan  and  the 
Northwestern  Punjab)  was  the/' richest  "  province  of 
— ,  all  his  dominions,^     We  know  also,  that  certain  cities 
/^  in  Northern  India,  described  in  the  Hindu  Epics,  and 
confirmed  by  accounts  of  the  Greeks,  were  of  great 

1 "  Early  History  of  India  "  by  V.  R.  Smith,  3d  ed.  p.  33,    ; 


A  HISTORICAL  RETROSPECT  5 

size  and  architectural  magnificence.  Lastly,  as  far 
back  as  the  middle  of  the  seventh  century  b.  c,  the  vil- 
lagers of  India  had  "  sufficiency  for  their  simple  needs." 
"  There  was  security ;  there  was  independence, —  there 
were  no  landlords  and  no  paupers."  ^  The  mass  of  the 
people  "  held  it  degradation  to  which  only  dire  misfor- 
tune would  drive  them,  to  work  for  hire."  ^  Add  to 
these  facts,  that  "  there  was  little,  if  any  crime,"  jand  a  — \ 
picture  of  the  Golden  Age  is  completed. 

So  far_as  the  conHitinn<;  gj  international  trade  are 
concerned,  we  find  that^exceptjimder  British  rule,  In-  ^     ^j 
dia  has  always  had  more  to  sell  andTess  to  purchase;         A 
in  manufactured  goods,— that  the  balance  of   trade'    ^  / 
was  always  in  her  faY-oIu:-;  that  the  Rorriahs  "Kave"teft 
on  record  bitter  complaints  of  the  constant  drain  of 
gold  and  silver  from  their  country  into  India, —  a  com- 
plaint repeated  by  Englishmen  as  late  as  the  eighteenth 
century;  and  that,  for  more  than  a  century  and  a  half 
(1603-1757)   the  profits  of  the  East  India  Company 
were  made  by  the  importation  of  Indian  manufactures 
into  England.     During  that  time,   England  was  the 
purchaser    and    India    the   vendor    of    manufactured 
goods,  largely  for  cash.  - — r 

General  Condition  of  the  People  Under  Hindu  and  ^ 
Mohammedan  Rule.  As  to  the  general  condition  of 
the  people  under  Hindu  and  Mohammedan  govern- 
ments during  the  twenty-two  centuries  for  which  we 
have  authentic  historical  data,  beginning  with  the  in- 
vasion of  Alexander  the  Great,  and  ending  with  the 
British  occupation   of   Indian   provinces   at   different 

2  "  Buddhist  India  "  by  Rhys  Davids,  London,  1903,  p.  49. 
» Ibid.,  ■p.  51. 


6  ENGLAND'S  DEBT  TO  INDIA 

times  from  1757  to  1858,  ample  testimony  shows  that 
the  mass  of  the  population  had  sufficient  to  satisfy  their 
simple  wants,  except  in  j.criods  of  famine ;  that  the 
country  had  prosperous  bankers,  who  loaned  money  to 
prince  and  peasant,  negotiated  commercial  paper,  and 
held  all  kinds  of  securities ;  and  that  an  extensive  home 
and  foreign  trade  was  carried  on  continuously. 

It  has  become  the  fashion  for  English  publicists  and 
historians  to  stress  what  they  deem  the  superiority  of 
British  to  native  rule  in  India.  Doubtless  the  former 
has  its  peculiar  merits,  but  to  assert  that  the  country 
has  never  before  known  such  "  economic  prosperity," 
or  experienced  the  administration  of  such  even-handed 
justice  as  under  British  rule,  is  to  disclose  unjustifiable 
mental  bias  or  ignorance.  A  number  of  just  and  fair- 
' — minded  Englishmen  have  deplored  such  utterances, 
and  a  service  may  be  rendered  to  both  England  and  In- 
dia by  transcribing  a  few  opinions  on  that  point : 

India  Reform  Pamphlet.  In  a  pamphlet  on  "  India 
Reform"  (No.  IX),  pubHshed  in  1853  by  the  India 
Reform  Society  of  London,  which  had  thirty-seven 
members  of  Parliament  on  its  committee,  the  subject 
was  examined  in  the  light  of  historical  evidence. — 

"  We  found  the  people  of  India,  it  is  said,  abject, 
degraded,  false  to  the  very  core.  .  .  .  The  most  in- 
dolent and  selfish  of  our  own  governors  have  been 
models  of  benevolence  and  beneficence  when  compared 
with  the  greatest  of  the  native  sovereigns.  The  luxuri- 
ous selfishness  of  the  Moghul  Emperors  depressed  and 
enfeebled  the  people.  Their  predecessors  were  either 
unscrupulous  tyrants  or  indolent  debauchees.  .  .  . 
Having  the  command  of  the  public  press  in  this  coun- 
try and  the  sympathy  of  the  public  mind  with  us,  it  is 


A  HISTORICAL  RETROSPECT  7 

an  easy  task  thus  to  exalt  ourselves  at  the  expense 
of  our  predecessors.  We  tell  our  own  story  and  our 
testimony  is  unimpeachable ;  but  if  we  find  anything 
favourable  related  of  those  who  have  preceded  us, 
the  accounts  we  pronounce  to  be  suspicious.  We  con- 
trast the  Moghul  conquest  of  the  fourteenth  century 
with  the  *  victorious,  mild  and  merciful  progress  of 
the  British  arms  in  the  East  in  the  nineteenth.'  But  if 
our  object  was  a  fair  one,  we  should  contrast  the  Mus- 
salman  invasion  of  Hindusthan  with  the  contemporane- 
ous Norman  invasion  of  England  —  the  characters  of 
the  Mussalman  sovereigns  with  their  contemporaries 
in  the  West  —  their  Indian  wars  of  the  fourteenth  cen- 
tury with  our  French  wars  or  with  the  Crusades  —  the 
effect  of  the  Mohammedan  conquest  upon  the  character 
of  the  Hindu  with  the  effect  of  the  Norman  conquest 
upon  the  Anglo-Saxon  when  *  to  be  called  an  English- 
man was  considered  as  a  reproach  —  when  those  who 
were  appointed  to  administer  justice  were  the  fountain 
of  all  iniquity  —  when  magistrates  whose  duty  it  was 
to  pronounce  righteous  judgments  were  the  most  cruel 
tyrants  and  greater  plunderers  than  common  thieves 
and  robbers ' ;  when  the  great  men  were  inflamed 
with  such  a  rage  of  money  that  they  cared  not  by 
what  means  it  was  acquired  —  when  the  licentiousness 
was  so  great  that  a  princess  of  Scotland  found  *  it 
necessary  to  wear  a  religious  habit  in  order  to  pre- 
serve her  person  from  violation!'  (Henry  of  Hunt- 
ington, Anglo-Saxon  Chronicle,  and  Eadmon.) 

"  The  history  of  Mohammedan  dynasty  in  India  is 
full,  it  is  said,  of  lamentable  instances  of  cruelty  and 
rapacity  of  the  early  conquerors,  not  without  precedent 
in  the  contemporary  Christian  history ;  for;  when  Jeru- 
salem was  taken  by  the  first  Crusaders,  at  the  end  of 
the  eleventh  century,  the  garrison,  consisting  of  40,000 
men,  *  was  put  to  the  sword  without  distinction ;  arms 
protected  not  the  brave,  nor  submission  the  timid;  no 
age  or  sex  received  mercy ;  infants  perished  by  the 
same  sword  that  pierced  their  mothers.     The  streets 


o 


8  ENGLAND'S  DEBT  TO  INDIA 

of  Jerusalem  were  covered  with  heaps  of  slain,  and  the 
shrieks  of  agony  and  despair  resounded  from  every 
house.'  When  Louis  the  Seventh  of  France,  in  the 
twelfth  century,  '  made  himself  master  of  the  town  of 
Vitri,  he  ordered  it  to  be  set  on  fire.'  In  England, 
at  the  same  time,  under  our  Stephen,  war  *  was  carried 
on  with  so  much  fury,  that  the  land  was  left  uncul- 
tivated, and  the  instruments  of  husbandry  were  left 
or  abandoned,' —  and  the  result  of  our  French  wars 
in  the  fourteenth  century,  was  a  state  of  things  '  more 
horrible  and  destructive  than  was  ever  experienced  in 
any  age  or  country.'  The  insatiable  cruelty  of  the 
Mohammedan  conquerors,  it  is  said,  stands  recorded 
upon  more  undeniable  authority  than  the  insatiable 
benevolence  of  the  Mohammedan  conquerors.  We 
have  abundant  testimony  of  cruelty  of  contemporary 
Christian  conquerors, —  have  we  any  evidence  of  their 
benevolence  ?  " 

"  As  attempts  are  thus  systematically  made,  in  bulky 
volumes,  to  run  down  the  character  of  Native  govern- 
ments and  sovereigns,  in  order  that  we  may  have  a 
fair  pretext  for  seizing  upon  their  possessions,  it  be- 
comes necessary  to  show  that  we  have  a  Christian 
Roland  for  every  native  Oliver;  that  if  the  Moham- 
medan conquerors  of  India  were  cruel  and  rapacious, 
they  were  matched  by  their  Christian  contemporaries. 
It  is  much  our  fashion  to  compare  India  in  the  fifteenth 
and  sixteenth  centuries  with  England  in  the  nineteenth, 
and  to  pique  ourselves  upon  the  result.  *  When  we 
compare  other  countries  with  England,'  said  a  saga- 
cious observer,*  '  we  usually  speak  of  England  as  she 
now  is, —  we  scarcely  ever  think  of  going  back  beyond 
the  Reformation,  and  we  are  apt  to  regard  every  for- 
eign country  as  ignorant  and  uncivilised,  whose  state 
of  improvement  does  not  in  some  degree  approximate 
to  our  own,  even  though  it  should  be  higher  than  our 
own  was  at  no  distant  period.'     It  would  be  almost  as 

*  Sir  Thomas  Munro. 


A  HISTORICAL  RETROSPECT  9 

fair  to  compare  India  in  the  sixteenth  with  England 
in  the  nineteenth  century,  as  it  would  be  to  compare 
the  two  countries  in  the  first  centuries  of  the  Christian 
era,  when  India  was  at  the  top  of  civilisation,  and  Eng- 
land at  the  bottom." 

The  Observations  of  Mr.  Torrens,  M.  P.,  comparing 
India  with  Europe.  The  matter  has  been  discussed 
lucidly,  forcibly  and  fairly  by  Mr.  Torrens,  M.P.,  who 
points  out  that 

"There  never  was  an  error  more  groundless  than 
that  which  represented  the  ancient  systems  of  Indian 
rule  as  decrepit  or  degrading  despotisms,  untempered 
by  public  opinion.  It  accords  too  well  with  the  arro- 
gance of  national  self-love  and  seems  too  easily  to  lull 
the  conscience  of  aggression  to  pretend  that  those 
whom  it  has  wronged  were  superstitious  slaves,  and 
that  they  must  have  so  remained  but  for  the  disin- 
terested violence  of  foreign  civilisation  introduced  by 
it,  sword  in  hand.  This  pretentious  theory  is  con- 
futed by  the  admissions  of  men  whose  knowledge  can- 
not be  disputed  and  whose  authority  cannot  be 
denied."  ^ 

As  to  the  so-called  usurpations,  infamies  and  fan- 
aticism of  Indian  monarchs,  he  asks  the  reader  to  com- 
pare them  with  the  deeds  and  practices  of  the  Borgias, 
Louis  XL,  Philip  IL,  Richard  III.,  Mary  Tudor  and 
the  last  of  the  Stuarts,  and  to  "  look  back  at  the  family 
picture  of  misrule "  in  Europe,  from  Catherine  de 
Medici  to  Louis  le  Grand, —  from  Philip  the  Cruel  to 
Ferdinand  the  Fool, —  from  John  the  Faithless  to 
Charles  the  False, —  not  forgetting  the  parricide  Peter 
of  Muscovy  and  the  Neapolitan  Bourbons !  *'  It  is  no 
more  true,"   he   concludes,   "  of   Southern   Asia  than 

^  Torrens,  "  Empire  in  Asia,"  London,  p.  100. 


10  ENGLAND'S  DEBT  TO  INDIA 

of  Western  Europe  to  say  that  the  everyday  habits 
of  supreme  or  subordinate  rule  were  semi-barbarous, 
venal,  sanguinary  or  rapacious." 

^  It  is  generally  assumed  that  Indian  civilisation  and 
prosperity  attained  its  flood-mark  during  the  period 
which  intervenes  between  the  invasion  of  Alexander 
(327  B.C.)  and  that  of  Mahmud  of  Ghazni  (1000 
A.  D.).     When   Mahmud   invaded   India,   the   country 

^ — .  was  overflowing  with  wealth.  To  quote  the  language 
of  Reform  Pamphlet  No.  9 :  "  Writers,  both  Hindu 
and  Mussulman,  unite  in  bearing  testimony  to  the  state 
of  prosperity  in  which  India  was  found  at  the  time  of 
the  first  Mohammedan  conquest.  They  dwell  with 
admiration  on  the  extent  and  magnificence  of  the  cap- 
ital of  the  Kingdom  of  Canauj,  and  of  the  inexhaust- 
ible riches  of  the  Temple  of  Somnath."  The  wealth 
that  Mahmud  carried  away  from  India  was  insignifi- 
cant compared  to  what  remained  there.  His  raids 
were  confined  chiefly  to  the  northwestern  provinces ; 
only  for  two  brief  periods  did  he  penetrate  into  the 
Doab  between  Ganga  and  Jamna,  and  only  once  in 
Gujrat,  Kattiawar.  The  whole  of  Central  India, 
which  had  for  so  long  remained  the  centre  of  great 
political  activities  under  the  Nandas,  the  Mauryas  and 
the  Guptas;  the  whole  of  Eastern  India,  covering  the 
rich  and  fertile  tracts  which  comprise  the  modern 
provinces  of  Bengal  and  Assam ;  the  whole  of  the 
south  had  remained  untouched. 

India  Under  the  Mohammedans.  The  first  Moham- 
medan dynasty  began  its  rule  at  Delhi  in  1206  a.  d.,  and 
from  that  time  on,  the  Mohammedan  rulers  of  India 
spent  whatever  they  acquired  from  India  within  the 


A  HISTORICAL  RETROSPECT  ii 

country  itself.  From  1206  a.  d.  to  the  middle  of  the 
eigki-eenth  century,  when  the  British  began  to  acquire 
rights  of  sovereignty  in  India,  only  twice  was  the 
country  raided  with  any  degree  of  success. 

Raid  of  Tamerlane.  The  first  of  these  two  raiders 
was  Tamerlane,  who  sacked  Delhi  in  1398  a.  d.,  and  is 
said  to  have  carried  off  "  very  great "  booty.  Tamer- 
lane's expedition  also  covered  only  a  small  part  of  the 
country  invaded  by  him  —  he  never  went  beyond  Delhi, 

In  1526  A.  D.  came  the  Mogul  invasion  by  Baber. 
Baber,  however,  came  to  stay  and  die  in  India. 

From  1206  to  1526  A.  D.  During  the  centuries 
from  1206  to  1526  A.  D.  the  country  was,  no  doubt,  in  a 
state  of  constant  unrest  on  account  of  the  frequent 
wars  between  the  indigenous  Hindu  population  and  the 
"  foreign  Mohammedan  rulers."  Sometimes  even  the 
latter  fought  among  themselves  out  of  rivalry,  as 
was  not  infrequently  the  case  in  the  England  of  the 
same  centuries.  There  was,  however,  no  drain  of 
wealth  out  of  India,  and  the  frequent  wars  did  not 
materially  interfere  with  the  processes  of  production 
and  the  amassing  of  wealth.  From  the  account  of 
travellers  who  visited  the  country  during  these  cen- 
turies, as  well  as  from  the  histories  of  the  period,  we 
have  enough  material  to  j:udge  of  the  general  economic 
prosperity  of  the  people.:    Elphinstone  says : 

"  The  condition  of  the  people  in  ordinary  times  does 
not  appear  to  have  borne  the  marks  of  oppression. 
The  historian  of  Feroz  Shah  (a.  d.  1351-1394)  expati- 
ates on  the  happy  state  of  the  ryots,  the  goodness  of 
their  houses  and  furniture,  and  the  general  use  of  gold 
and  silver  ornaments  by  their  women."  Elphinstone 
adds  that  "  although  this  writer  is  a  panegyrist  whose 


12  ENGLAND'S  DEBT  TO  INDIA 

writings  are  not  much  to  be  trusted,  still  the  mere  ' 
mention  of  such  details  as  that  every  ryot  has  a  good 
bedstead  and  a  neat  garden  shows  a  more  minute  at- 
tention to  the  comforts  of  the  people  than  would  be 
met  with  in  a  modern  author." 

Elphinstone  on  the  General  State  of  the  Country. 

The  general  state  of  the  country  must  no  doubt 
have  been  flourishing.  Nicolo  de  Conti,  who  trav- 
elled about  1420  A.  D.  speaks  highly  of  what  he  saw 
in  Guzerat,  and  found  the  banks  of  the  Ganges 
covered  with  towns  amidst  beautiful  gardens  and 
orchards,  and  passed  four  famous  cities  before  he 
reached  Maarazia,  which  he  describes  as  a  powerful 
city  filled  with  gold,  silver  and  precious  stones.  His 
accounts  are  corroborated  by  those  of  Barbora  and 
Bartema,  who  travelled  in  the  early  part  of  the  six- 
teenth century.® 

Ccesar  Frederic  and  Jbn  Batuta. 

Csesar  Frederic  gives  a  similar  account  of  Guzerat, 
and  Ibn  Batuta,  who  travelled  during  the  anarchy  and 
oppression  of  Mohammed  Tuglak's  reign,  in  the  middle 
of  the  fifteenth  century,  when  insurrections  were  rag- 
ing in  most  parts  of  the  country,  enumerates  the  large 
and  populous  towns  and  cities,  and  gives  a  high  im- 
pression of  the  state  the  country  must  have  been  in 
before  it  fell  into  disorder.^ 

Abdnrizag. 

"  Abdurizag,  an  ambassador  from  the  grandson  of 
Tamerlane,  visited  the  South  of  India  in  1442,  and 
concurs  with  other  observers  in  giving  the  impression 
of  a  prosperous  country.  The  Kingdom  of  Kandeish 
was  at  this  time  in  a  high  state  of  prosperity  under  its 
own  kings ;  the  numerous  stone  embankments  by  which 

«  Elphinstone,  Vol.  II,  p.  203. 
^  Ibid.,  p.  206. 


A  HISTORICAL  RETROSPECT  13 

the  streams  were  rendered  applicable  to  irrigation  are 
equal  to  anything  in  India  as  works  of  industry  and 
ability."  » 

Baber. 

"  Baber,  the  first  sovereign  of  the  Moghul  dynasty, 
although  he  regards  Hindusthan  with  the  same  dislike 
that  Europeans  still  feel,  speaks  of  it  as  a  rich  and 
noble  country,  and  expresses  his  astonishment  at  the 
swarming  population  and  the  innumerable  workmen 
of  every  kind  and  description.  Besides  the  ordinary 
business  of  his  kingdom,  he  was  constantly  occupied 
with  making  aqueducts,  reservoirs  and  other  improve- 
ments, as  well  as  introducing  new  fruits,  and  other 
productions  of  remote  countries."  ^ 

Sher  Shah. 

Baber's  son,  "  Humayun,  whose  character  was  free 
from  vices  and  violent  passions,  was  defeated,  and 
obliged  to  flee  from  Hindusthan,  by  Sher  Shah,  who  is 
described  as  a  prince  of  consummate  prudence  and 
ability,  '  whose  measures  were  as  wise  as  benevolent,' 
and  who,  notwithstanding  his  constant  activity  in  the 
field,  during  a  short  reign  had  brought  his  territories 
in  the  highest  order,  and  introduced  many  improve- 
ments into  his  civil  government. 

"  He  made  a  high  road  extending  for  four  months' 
journey  from  Bengal  to  the  Western  Rhotas  near  the 
Indus,  with  caravanserais  at  every  stage,  and  wells  at 
every  mile  and  a  half.  There  was  an  Imam  and 
Muezzin  at  every  mosque,  and  provisions  for  the  poor 
at  every  caravanserai,  with  attendants  of  proper  caste 
for  Hindus  as  well  as  for  Mussulmen.  The  road  was 
planted  with  rows  of  trees  for  shade,  and  in  many 
places  was  in  the  state  described  when  the  author 
saw  it,  after  it  had  stood  for  eighty-two  years."  ^° 

8  Elphinstone,  Reform  Pamphlet  No.  g,  p.  10. 
s Ibid. 

i**  Elphinstone,  Vol.  II,  p.  151.  Reform  Pamphlet  No.  9,  pp. 
10  and  II. 


V 


14  ENGLAND'S  DEBT  TO  INDIA 

Akbar. 

"  It  is  almost  superfluous  to  dwell  upon  the  char- 
acter of  the  celebrated  Akbar,  who  was  equally  great 
in  the  cabinet  and  in  the  field,  and  renowned  for  his 
learning,  toleration,  liberality,  clemency,  courage,  tem- 
perance, industry  and  largeness  of  mind.  But  it  is  to 
his  internal  policy  that  Akbar  owes  his  place  in  that 
highest  order  of  princes  whose  reigns  have  been  a 
blessing  to  mankind.  He  forbade  trials  by  ordeal,  and 
marriages  before  the  age  of  puberty,  and  the  slaughter 
of  animals  for  sacrifice.  He  employed  his  Hindu  sub- 
jects equally  with  Mohammedans,  abolished  the  capita- 
tion tax  on  infidels  as  well  as  all  the  taxes  on  pilgrims, 
and  positively  prohibited  the  making  slaves  of  persons 
taken  in  war.  He  perfected  the  financial  reforms 
which  had  been  commenced  in  those  provinces  by  Sher 
Shah.  He  remeasured  all  the  lands  capable  of  cul- 
tivation within  the  Empire;  ascertained  the  produce 
of  each  bigah;  determined  the  proportion  to  be  paid  to 
the  public;  and  commuted  it  for  a  fixed  money  rent, 
giving  the  cultivator  the  option  of  paying  in  kind  if 
he  thought  the  money  rate  too  high.  He  abolished,  at 
the  same  time,  a  vast  number  of  vexatious  taxes  and 
fees  to  officers.  The  result  of  these  wise  measures  was 
to  reduce  the  amount  of  public  demand  consider- 
ably."" 

Pietro  del  Valle. 

The  Italian  traveller,  Pietro  del  Valle,  wrote  in  1623, 
"  generally  all  live  much  after  a  genteel  way  and  they 
do  it  securely ;  as  well  because  the  king  does  not  per- 
secute his  subjects  with  false  accusations,  nor  deprive 
them  of  anything  when  he  sees  them  live  splendidly  and 
with  the  appearance  of  riches  !  "  ^- 

Shah  Jehan. 

"  But  the  reign  of   Shah  Jehan,   the  grandson  of 

11  Reform  Pamphlet  No.  9,  p.  n  on  the  authority  of  El- 
phinstone,  Vol.  II. 

12  Quoted  by  Reform  Pamphlet,  p.  12. 


A  HISTORICAL  RETROSPECT  15 

Akbar,  was  the  most  glorious  ever  known  in  India. 
His  own  dominions  enjoyed  almost  uninterrupted  tran- 
quillity and  good  government ;  and  although  Sir  Thomas 
Roe  was  struck  with  astonishment  at  the  profusion 
of  wealth  which  was  displayed  when  he  visited  the 
Emperor  in  his  camp  in  161 5,  in  which  at  least  two 
acres  were  covered  with  silk,  gold  carpets  and  hang- 
ings, as  rich  as  velvet,  embossed  with  gold  and  pre- 
cious stones  could  make  them,  yet  we  have  the  testimony 
of  Tavernier  that  he  who  caused  this  celebrated  pea- 
cock throne  to  be  constructed,  who,  at  the  festival  of 
his  accession,  scattered  amongst  the  bystanders  money 
and  precious  things  equal  to  his  own  weight,  *  reigned 
not  so  much  as  a  king  over  his  subjects,  but  rather  as 
a  father  over  his  family.' 

"  After  defraying  the  expenses  of  his  great  expedi- 
tion to  Candahar  and  wars  in  Balk,  Shah  Jehan  left  a 
treasure  of  about  £24,000,000,  in  coins  and  vast  ac- 
cumulations of  wrought  gold,  silver  and  jewels."  ^^ 

Aurangzeh  and  His  Successors. 

Notwithstanding  the  misgovernment  of  Aurangzeb 
and  the  reign  of  a  series  of  weak  and  wicked  princes, 
together  with  the  invasion  of  Nadir  Shah,  who  car- 
ried away  enormous  wealth  when  he  quitted  Delhi  in 
1739,  the  country  was  still  in  a  comparatively  pros- 
perous condition.^* 

The  Raid  by  Nadir  Shah.  The  raid  by  Nadir  Shah 
was  the  second  one  which  took  place  between  1206  a.  d. 
and  1757  A.  D.  He  carried  off  "  enormous  wealth,"  but 
how  enormous  could  it  have  been  when  one  considers 
that  even  he  did  not  go  beyond  Delhi,  leaving  the  rest 
of  the  north,  the  greater  part  of  the  west,  and  the  en- 

13  Reform  Pamphlet  on  the  authority  of  Elphinstone,  Vol.  II, 
pp.  293-299. 

1*  Reform  Pamphlet  No.  9,  p.  16. 


i6  ENGLAND'S  DEBT  TO  INDIA 

tire  east  and  south  of  India  unaffected  and  untouched? 
Throughout  the  Mohammedan  dominance,  large  parts 
of  India  remained  under  Hindu  rule,  and  the  historians 
are  agreed  that  in  the  territories  of  the  Hindu  princes 
general  prosperity  prevailed.  Some  of  them  are  said 
to  have  attained  to  a  pitch  of  power  and  splendour 
which  had  not  been  surpassed  by  their  ancestors. 

Pre-British  Period.  We  are,  however,  more  di- 
rectly concerned  with  the  economic  condition  of  India 
in  the  period  immediately  preceding  the  establishment 
of  British  power.  We  have  some  vivid  glimpses  pre- 
served for  us  in  the  accounts  of  the  contemporary  Eu- 
ropean travellers  and  Anglo-Indian  administrators, — 
writers  of  the  type  of  Malcolm,  Elphinstone,  Monroe, 
Orme,  and  Todd. 

Principal  Political  Divisions  of  the  Country.  The 
country  was  then  divided  into  several  political  divi- 
sions. The  rulers  were  practically  independent  mas- 
ters of  their  respective  territories,  though  some  ac-' 
knowledged  a  nominal  suzerainty  of  the  Grand  Mogul. 
In  the  north,  Bengal,  Behar,  and  Orissa  were  ruled  by 
the  Nawab  of  Bengal,  with  his  seat  in  Murshidabad. 
Oude  was  administered  by  the  Nawab  Vizir  who  had 
several  feudatories,  including  the  Rajah  of  Benares. 
The  Mahrattas  were  practically  supreme  in  Delhi 
where  the  Grand  Mogul  still  maintained  the  shadow  of 
his  glory, —  also  in  Rajputana,  Central  India  and  the 
Western  Ghauts.  The  South  was  divided  between 
the  Nawab  of  Hyderabad,  with  the  Nawab  of  Arcot 
and  the  Rajah  of  Tanjore  under  him,  and  the  prin- 
cipality of  Mysore,  with  a  Hindu  prince  as  sovereign 
and  a  Mohammedan  minister  as  ruler.     The  North- 


A  HISTORICAL  RETROSPECT  17 

west,  comprising  the  land  of  the  Five  Rivers  and  the 
territory  between  the  Sutlej  and  the  Jamna,  were  still 
nominally  under  the  Mogul.  By  the  time,  however, 
that  the  British  established  themselves  at  Delhi,  it  had 
completely  passed  into  the  hands  of  the  Sikhs,  and  it 
was  from  them  that  the  British  finally  took  it.  Scindh 
was  under  the  Amirs. 

We  will  now  briefly  narrate  the  means  whereby  Brit- 
ain acquired  these  territories,  with  a  statement  of  their 
economic  condition  before  and  after  British  occupa- 
tion. 

Tanjore  and  Arcot.  Let  us  begin  with  the  South. 
The  small  Hindu  principality  of  Tanjore,  off  the  coast 
of  Coromandel,  was  the  first  victim  of  British  aggres- 
sion. For  several  centuries  this  state  had  enjoyed  the 
rights  of  sovereignty;  and  in  1741,  Pratap  Singh  suc- 
ceeded to  the  throne  as  a  result  of  a  domestic  revolu- 
tion with  which  the  EngHsh  had  nothing  to  do.  The 
latter  acknowledged  him  unhesitatingly  as  ruler,  and 
established  a  kind  of  friendship  with  him  against  their 
rivals,  the  French.  The  brother  of  Pratap  Singh,  one 
Sahujee,  subsequently  approached  the  British  with  an 
offer  of  the  fort  and  jagir  of  Devikotah  as  the  price 
of  their  help  to  put  him  on  the  throne.  The  British 
"  despatched  an  army  to  dethrone "  Pratap  Singh.^^ 
The  expedition  failed,  and  a  second  was  resolved  on. 
Devikotah  was  taken,  and  they  "  entered  into  negotia- 
tions with  Pratap  Singh  —  agreed  to  desist  from  fur- 
ther hostilities  —  to  abandon  him  for  whom  they  pre- 
tended to  have  fought,  but  engaged  to  secure  his  person 
and  to  receive  a  fixed  sum  for  his  maintenance,  on  con- 
is  Torrens,  pp.  20-21;  Mill,  Bk.  IV,  p.  91. 


i8  ENGLAND'S  DEBT  TO  INDIA 

dition  of  being  suffered  to  remain  undisputed  masters 
of  Devikotah  and  the  circumjacent  territory."  This 
was  the  beginning  of  the  conquest  of  Hindustan. 

The  principahty  of  Tan j  ore  was  included  in  the 
dominions  of  the  Nawab  of  Carnatic,  who  in  his  turn, 
was  considered  to  be  under  the  Subah  of  Deccan. 
The  desire  for  the  possession  of  Devikotah  on  the 
part  of  the  British  had  its  origin  in  their  rivalry  with 
the  French.  When,  in  1754,  the  English  and  the 
French  made  peace,  and  signed  a  treaty,  mutually  re- 
nouncing any  further  designs  of  territorial  aggres- 
sion in  India,  and  agreeing  to  interfere  no  more  in  the 
affairs  of  the  local  governments,  it  might  have  been  ex- 
pected that  the  troubles  of  the  people  of  Carnatic  were 
over. 

Muhammad  Ali,  the  friend  of  the  English,  had  been 
acknowledged  the  Nawab  of  Carnatic.  The  ink  on 
this  compact  was  scarcely  dry  when  the  British  entered 
into  negotiations  to  reduce  certain  other  Hindu  prin- 
cipalities included  in  the  Nawab's  dominions  which 
the  latter  asserted  owed  large  sums  of  tribute-money 
to  him.  The  French  authorities  at  Pondicherry  pro- 
tested without  result.  Eventually  they  were  drawn 
into  hostilities  and  worsted.  The  first  treaty  with  the 
Nawab  of  Carnatic  was  made  in  1763,  in  which  he 
acknowledged  his  liability  to  the  East  India  Company 
for  all  the  expenses  they  had  incurred  in  the  war  with 
the  French,  and  undertook  to  pay  them  off  by  annual 
instalments  of  28  lacs  of  rupees,  i.e.,  £280,000.  In 
the  course  of  time,  the  Nawab  was  asked  to  bestow  a 
grant  of  lands,  the  rents  and  revenues  of  which  should 
be  credited  to  the  debt.     This  had,  of  course,  to  be  con- 


A  HISTORICAL  RETROSPECT  19 

ceded.     The  Jagirdar,  however,  was  soon  to  become 
the  master. 

Before  the  century  was  over,  the  Nawab  of  Carnatic, 
the  first  patron  of  the  British,  when  they  landed 
friendless  and  ''  shelterless  "  on  the  coast  of  Coroman- 
del,"  later  their  ally  in  the  war  with  the  French,  became 
reduced  to  the  position  of  the  mere  creature  of  the  hon- 
ourable company,  and  wholly  at  the  mercy  of  its  serv- 
ants. By  the  time  Lord  Wellesley  came  to  make  a 
fresh  treaty  with  the  Nawab,  "  The  Carnatic  had  been 
inmeshed  in  the  net  of  our  friendship  and  the  noose  of 
our  protection."  ^^  By  the  treaty  made  by  Lord  Wel- 
lesley, it  was  declared  that  four-fifths  of  the  revenue 
of  the  principality,  the  management  of  which  had 
already  passed  into  the  hands  of  the  company,  was 
forever  vested  in  the  company,  and  the  remaining  one- 
fifth  appropriated  for  the  support  of  the  Nawab. 
These  emoluments,  along  with  the  dignity  and  prestige 
of  the  nawabship,  were  enjoyed  by  the  last  scion  of  the 
family  till  1853,  when  "  Lord  Dalhousie  thought  the 
time  had  arrived  to  let  the  curtain  fall  upon  the  farce 
of  gratitude  to  Arcot.  The  cabinet  of  Lord  Aberdeen, 
the  Court  of  Directors  assenting,  he  forbade  Azimshah, 
the  successor  of  the  last  nawab,  to  assume  the  title, 
and  refused  to  pay  him  the  stipulated  fifth  of  the 
revenues,  which  he  claimed  as  undisputed  heir,  "  upon 
the  ground  that  when  treaties  are  made  '  forever,'  the 
suzerain  is  not  bound  longer  than  the  sense  of  expe- 
diency lasts."  "  In  commenting  upon  what  took  place 
in  1792,  at  the  time  of  the  death  of  the  Nawab  who 

1^  Arnold,   Dalhousie's   "Administration   of   British   India," 
London.    Vol.  II,  p.  171. 
I'Torrens,  pp.  378-79. 


20  ENGLAND'S  DEBT  TO  INDIA 

first  entered  into  relations  with  the  British,  James  Mill 
in  his  "  History  of  British  India  "  says : 

"  A  fact  is  here  forcibly  urged  upon  our  attention,  of 
which  it  is  important  to  find  the  true  explanation.  Un- 
der their  dependence  upon  the  British  Government, 
it  has  been  seen  that  the  people  of  Oude  and  Karnatic, 
two  of  the  noblest  provinces  of  India,  were,  by  mis- 
government,  plunged  into  a  state  of  wretchedness  with 
which  no  other  part  of  India, —  hardly  any  part  of 
earth,  had  anything  to  compare.  In  what  manner  did 
the  dependence  of  the  native  states  upon  the  English, 
tend  to  produce  these  horrid  effects  ?  "  " 

This  question  may  best  be  answered  in  the  words  of 
the  Duke  of  Wellington,  who  as  an  historian  of  the 
administration  of  his  brother,  the  Marquis  of  Wellesley, 
says,  speaking  of  the  treaty  made  with  the  Nawab  in 
1792: 

"  One  of  the  great  evils  in  this  alliance,  or  in  all 
those  of  this  description  formed  in  India,  was  that  it 
provided  that  the  Company  should  not  interfere  in  the 
internal  concerns  of  the  Nawab's  government.  At 
the  same  time  the  interference  of  the  Company  in 
every  possible  case  was  absolutely  necessary  for  the 
support  of  the  Native  Government,  and  ivas  practiced 
on  every  occasion/'  Another  evil  which  affected  this, 
as  well  as  every  alliance  of  the  same  description,  was 
.  .  .  that  the  Nawab  zuas  obliged  to  borrozv  money  at 
large  interest  in  order  to  make  his  payment  at  the 
stipulated  periods  and  .  .  .  the  laws  were  made  by 
the  Company's  civil  and  military  and  the  European 
inhabitants  of  Fort  St.  George  and  its  dependencies. 
In  this  view  of  the  evil,  it  was  of  enormous  magni- 
tude." ^« 

18  Book  VI,  pp.  51-52. 

19  Muir,  "The  Making  of  British  India,"  p.  217. 


A  HISTORICAL  RETROSPECT  21 

From  the  time  the  operation  of  the  treaty  of  1792 
was  observed,  every  governor  had  endeavoured  to  pre- 
vail upon  the  Nawab  to  consent  to  an  alteration  of  it 
whereby  the  Company's  resources  should  be  secured 
and  the  evils  above  described  be  prevented.  The  en- 
deavours, however,  failed  to  prevail  upon  the  Nawab 
to  hear  to  any  modification  of  the  treaty ;  when  the 
war  with  Tipu  broke  out,  the  country  was  labouring 
under  all  the  disadvantages  of  the  system,  its  resources 
were  depleted,  and  its  inhabitants,  from  long  oppres- 
sion, disaffected.  In  these  conditions  the  Marquis  of 
Wellesley  decided  upon  annexation.  He  found  a  pre- 
tence ready  to  hand  in  the  correspondence  which  the 
Nawab  and  his  son  had  been  carrying  on  with  the 
neighbouring  Prince  Tipu.  The  Marquis  decided  that 
"  in  consequence  of  this  breach  of  treaty,  the  company 
had  a  right  to  act  in  the  manner  best  suited  to  their 
own  interest."  That  arrangement  has  been  recorded 
above.  The  method  whereby  the  signature  of  the 
Nawab  was  obtained  is  however  most  significant. 

"  When  the  orders  from  the  Marquis  of  Wellesley 
reached  Madras,  the  Nawab,  Omdat  'ul  Omra,  was 
in  such  a  state  of  health  as  to  be  incapable  of  attend- 
ing to  business,  and  soon  afterwards  he  died.  His 
supposed  son  was  then  apprised  of  the  discoveries  (i.e., 
the  correspondence)  and  the  sentiments  of  the  British 
Government  in  consequence,  together  with  the  measures 
about  to  be  adopted  in  Carnatic.  He  refused  to  ac- 
cept the  situation  offered  him  under  the  new  arrange- 
ment." ^°  It  was  resolved  to  set  aside  the  young  Na- 
wab and  set  up  another  man,  the  brother  to  the  de- 

20Muir,  "The  Making  of  British  India,"  p.  219. 


22  ENGLAND'S  DEBT  TO  INDIA 

ceased,  on  the  throne,  on  condition  he  agreed  to  the 
proposed  terms.     This  was  accordingly  done. 

Mysore.  Hyder  AH  of  Mysore  was  a  person  of 
humble  origin.  By  dint  of  his  courage,  ability,  enter- 
prise and  resourcefulness,  he  rose  to  a  position  which 
enabled  him  to  usurp  the  powers  of  state,  setting  aside 
the  rightful  Hindu  prince,  and  reducing  him  to  the 
position  of  pensioner.  The  British  Government  en- 
tered into  treaty  relations  with  him,  recognising  him  as 
the  ruler.  His  first  quarrel  with  the  British  was  due 
to  their  seizure  of  Baramahal,  a  port  of  the  Kingdom 
of  Mysore.  Hyder  retaliated,  and  "  under  the  walls 
of  Madras,  dictated  a  new  treaty  with  the  company, 
which  was  to  furnish  him  with  seven  battalions  of 
sepoys  in  case  any  foreign  enemy  attacked  his  domin- 
ions." When,  in  1778,  the  British,  at  war  with  the 
French,  took  possession  of  Pondicherry,  they  attacked 
Mahe,  a  small  town  in  one  of  the  provinces  of  Mysore. 
Hyder  protested,  and  upon  being  disregarded,  invaded 
the  English  possessions  in  Carnatic  and  exacted  retri- 
bution. The  great  historian  of  Anglo-India,  Mill,  re- 
marks :  "  Hyder  was  less  detested  as  a  destroyer  than 
hailed  as  a  deliverer  .  .  .  and  the  English  commander 
himself  testifies  in  an  official  letter  that  "  There  is  no 
doubt  that  Hyder  has  greatly  attached  the  inhabitants 
to  him."  Torrens  remarks  that  later,  when  Pettah  and 
Arcot  were  taken  by  Hyder,  he  treated  the  inhabitants 
"  with  humanity ;  no  plundering  or  license  was  al- 
lowed; every  one  was  continued  in  the  enjoyment  of 
his  fortune,  and  all  who  held  places  under  the  Nawab 
retained  them;  to  the  English  officers,  Hyder  gave 
money    to    provide    for    their    necessities  " —  conduct 


A  HISTORICAL  RETROSPECT  23 

which  places  his  "  barbarity  "  in  favourable  contrast 
with  the  "  civilisation  "  of  the  English,  when  later  they 
sacked  his  capital. 

In  the  winter  of  1782,  before  the  war  with  the  Eng- 
lish had  terminated,  Hyder  died,  and  his  adversaries 
made  a  new  treaty  of  peace  with  his  son  Tipu.  The 
fidelity  of  Hyder's  Brahmin  minister  has  been  handed 
down  in  history  —  he  it  was  who  concealed  the  death 
of  his  prince  until  Tipu  reached  the  camp  and  claimed 
his  inheritance. 

Colonel  Fullarton's  "  View  of  the  Interests  of  India  " 
contains  an  estimate  of  the  character  of  Hyder  and 
conditions  during  his  reign.  The  writer  of  the  Re- 
form Pamphlet  remarks : 

"  Although  most  constantly  engaged  in  war,  the  im- 
provement of  his  country  and  the  strictest  executive 
administration  formed  his  constant  care.  Manufac- 
turer and  merchant  prospered  .  .  .  cultivation  in- 
creased, new  manufactures  were  established,  wealth 
flowed  into  the  kingdom  .  .  .  the  slightest  defalcation 
by  the  officers  of  revenue  was  summarily  punished. 
He  had  his  eye  upon  every  corner  of  his  own  domin- 
ions and  every  court  in  India.  .  .  .  Though  unable  to 
write  himself,  he  dictated  in  few  words  the  substance 
of  his  correspondence  to  secretaries  ...  he  united 
minuteness  of  detail  with  the  utmost  latitude  of  thought 
and  enterprise.  .  .  .  He  bequeathed  to  his  son,  Tipu 
Sultan,  an  overflowing  treasury,  a  powerful  empire,  an 
army  of  300,000  men  .  .  .  and  great  territories." 

The  following  is  the  substance  of  Moore's  estimate 
of  Tipu's  administration. 

"  When  a  person,  travelling  through  a  strange  coun- 
try, finds  it  well  cultivated,  populous  with  industrious 
habitants,  cities  newly  founded,  commerce  extending, 


24  ENGLAND'S  DEBT  TO  INDIA 

towns  increasing,  and  everything  flourishing  so  as 
to  indicate  happiness,  he  naturally  concludes  the 
form  of  government  congenial  to  the  people.  This  is 
a  picture  of  Tipu's  government  .  .  .  we  have  reason 
to  suppose  his  subjects  to  be  happy  as  those  of  any 
other  sovereign  ...  no  murmurings  or  complaints 
were  heard  against  him,  though  the  enemies  of  Tipu 
were  in  power,  and  would  have  been  gratified  by  any 
aspersions  of  his  character  .  .  .  but  the  inhabitants  of 
the  conquered  countries  ...  so  soon  as  an  opportunity 
offered,  scouted  their  new  master,  and  gladly  returned 
to  their  loyalty  again."  ^^ 

Dirom,  another  writer  pays  an  equally  high  tribute 
to  the  prosperity  of  Tipu's  country.^^ 

All  this  prosperity  was  not  created  entirely  by  Hyder 
or  his  son,  whose  sway  did  not  last  half  a  century. 
For  the  foundation  of  these  flourishing  conditions  we 
must  look  to  the  ancient  Hindu  dynasty  —  they  were 
the  constructors  of  those  magnificent  canals  which  in- 
tersect Mysore  and  insure  the  people  prodigal  returns 
from  the  fertile  soil. 

In  1789  occurred  the  third  war  with  Mysore,  result- 
ing in  a  peace  in  1792  whereby  Tipu  was  forced  to  pay 
a  heavy  indemnity  and  cede  half  his  territories.  It 
was  reserved  for  the  Marquis  of  Wellesley  to  wipe  out 
the  House  of  Hyder  completely,  by  annexing  a  large 
part  of  his  remaining  lands,  and  restoring  the  super- 
seded Hindu  dynasty  to  a  fraction  of  its  former  do- 
main under  the  title  of  the  Raja  of  the  state  of  Mysore. 

Northern  India.  From  the  south,  we  may  now  turn 
to  the  north  to  examine  conditions  preceding  British 

21  Moore's  "  Narrative  of  tlie  War  with  Tipu  Sultan,"  p.  201, 
quoted  in  the  Reform  Pamphlet. 

22  Dirom's  "  Narrative,"  p.  249, 


A  HISTORICAL  RETROSPECT  25 

occupation.  To  avoid  all  suspicion  of  political  or 
racial  bias,  we  will  let  the  English  writers  of  the  Re- 
form Pamphlet  speak. 

(^  Bengal. 

In  the  year  that  Hyder  established  his  sway  over 
Mysore,  Bengal, —  the  brightest  jewel  in  the  Imperial 
Crown  of  the  Moguls,  came  into  British  posses- 
sion. (  Clive  described  the  new  acquisition  as  "  a  coun- 
try of  inexhaustible  riches  "  and  one  that  could  not  fail 
to  make  its  new  masters  the  richest  corporation  in 
the  world.  Bengal  was  known  to  the  East  as  the 
Garden  of  Eden,  the  rich  kingdom.  Says  Mr.  Hol- 
well :  "  Here  the  property,  as  well  as  the  liberty,  of 
the  people,  are  inviolate.  The  traveller,  with  or 
without  merchandise,  becomes  the  immediate  care  of 
the  Government,  which  allots  him  guards,  without  any 
expense,  to  conduct  him  from  stage  to  stage.  .  .  . 
If  ...  a  bag  of  money  or  valuables  is  lost  in  this 
district,  the  person  who  finds  it  hangs  it  on  a  tree  and 
gives  notice  to  the  nearest  guard.  .  .  ."  ^^ 

The  rich  province  of  Dacca  was  cultivated  in  every 
part  .  .  .  justice  was  administered  impartially  .  .  . 
Jeswunt  Roy  ..  .  .  had  been  educated  in  purity,  in- 
tegrity and  indefatigable  attention  to  business,  and 
studied  to  render  the  government  of  his  province  con- 
ducive to  the  general  ease  and  happiness  of  his  people 
—  he  abolished  all  monopolies  and  the  imposts  upon 
grain.2* 

Such  was  the  state  of  Bengal  when  Alivardy  Khan 
.  .  .  assumed  its  government.  Under  his  rule  .  .  . 
the  country  was  improved ;  merit  and  good  conduct 
were  the  only  passports  to  his  favour.  He  placed 
Hindus  on  an  equality  with  Mussalmen,  in  choosing 

28  Howells'  "  Tracts  upon  India,"  Reform  Pamphlet  No.  g, 
p.  21. 

2*  Stewart's  "  History  of  Bengal,"  p.  430,  quoted  in  the 
pamphlet  No.  9,  p.  22. 


26  ENGLAND'S  DEBT  TO  INDIA 

Ministers,  and  nominating  them  to  high  miHtary  and 
civil  command.  The  revenues,  instead  of  being  drawn 
to  the  distant  treasury  of  Delhi  were  spent  on  the 
spot.^^ 

But  in  less  than  ten  years  after  Bengal  had  become 
subject  to  British  rule,  a  great  and  sudden  change  came 
over  the  land.  Every  ship,  Mr.  Macaulay  tells  us,  for 
some  time,  had  brought  alarming  tidings  from  Bengal. 
The  internal  misgovernment  of  the  province  had 
reached  such  a  pitch  that  it  could  go  no  further. 

"What  indeed,  was  to  be  expected  from  a  body  of 
public  servants  exposed  to  temptation  such  as  Clive 
once  said,  flesh  and  blood  could  not  bear  it,  armed  with 
irresistible  power,  and  responsible  only  to  the  corrupt, 
turbulent,  distracted,  ill-informed  Company,  situated 
at  such  a  distance  that  the  average  interval  between 
the  sending  of  a  despatch  and  the  receipt  of  an  answer 
was  above  a  year  and  a  half.  Accordingly  the  five 
years  which  followed  the  departure  of  Clive  from 
Bengal  saw  the  misgovernment  of  the  English  car- 
ried to  such  a  point  as  seemed  incompatible  with 
the  existence  of  society.  The  Roman  proconsul, 
who,  in  a  year  or  two,  squeezed  out  of  a  prov- 
ince the  means  of  rearing  marble  palaces  and 
baths  on  the  shores  of  Campania,  of  drinking 
from  amber  and  feasting  on  singing  birds,  of  exhibit- 
ing armies  of  gladiators  and  flocks  of  camelopards ; 
the  Spanish  viceroy,  who,  leaving  behind  him  the  curses 
of  Mexico  or  Lima,  entered  Madrid  with  a  long  train 
of  gilded  coaches,  and  sumpter  horses  trapped  and 
shod  with  silver,  were  now  outdone.  .  .  .  The  servants 
of  the  Company  obtained  for  themselves  a  monopoly 
of  almost  the  whole  internal  trade.  They  forced  the 
natives  to  buy  dear  and  sell  cheap.  They  insulted 
with    impunity    the    tribunals,    the    police    and    fiscal 

"^  Stewart's  "  History  of  Bengal,"  quoted  in  the  Reform 
Pamphlet  No.  9,  p.  22. 


A  HISTORICAL  RETROSPECT  27 

authorities  .  .  .  every  servant  of  a  British  factor  was 
armed  with  all  the  power  of  the  Company.  .  .  . 
Enormous  fortunes  were  thus  rapidly  accumulated  at 
Calcutta,  while  thirty  miUions  of  human  beings  were 
reduced  to  an  extremity  of  wretchedness.  .  .  .  Under 
their  old  masters,  .  .  .  when  evil  became  insupport- 
able, the  people  rose  and  pulled  down  the  government. 
But  the  English  Government  was  not  to  be  shaken  off. 
That  Government,  oppressive  as  the  most  oppressive 
form  of  barbarian  despotism,  was  strong  with  all  the 
strength  of  civilisation."  -" 

The  Kingdom  of  Oude.  The  same  testimony  re- 
garding the  East  India  Company's  destructive  and  ra- 
pacious misrule  applies  to  Oude.  While  Mr.  Warren 
Hastings  was  still  vested  with  supreme  rule  over  India, 
he  describes  a  condition  which  he  himself  was  instru- 
mental in  producing. 

"  I  fear  that  our  encroaching  spirit,  and  the  insolence 
with  which  it  has  been  exerted,  has  caused  our  al- 
liance to  be  as  much  dreaded  by  all  the  powers  of 
Hindustan  as  our  arms.  Our  encroaching  spirit,  and 
the  uncontrolled  and  even  protected  licentiousness  of 
individuals,  has  done  injury  to  our  national  reputa- 
tion. .  .  .  Every  person  in  India  dreads  a  connec- 
tion with  us."  2'^ 

Before  dealings  with  the  English  commenced,  Oude 
was  in  a  high  state  of  prosperity,  yielding,  without 
pressure  on  the  people,  an  income  of  three  millions, 
clear.  By  quartering  upon  the  Nawab  an  army  of 
soldiers,  as  well  as  a  host  of  civilians,  he  was  soon  re- 
duced to  a  state  of  bitterest  distress  and  his  country 
to  poverty,  his  income  being  reduced  in  a  few  years 

26  Macaulay's  "  Essay  on  Lord  Clive." 

27  Gleig's  "  Life  of  Hastings,"  Vol.  II,  quoted  in  the  Reform 
Pamphlet  No.  9,  p.  25. 


28  ENGLAND'S  DEBT  TO  INDIA 

to  half  its  former  amount.  "  In  nine  years,"  Mill  says, 
"  unjustifiable  extortions,  to  the  amount  of  thirty-four 
lacs  of  rupees  (£340,000)  per  annum,  had  been  prac- 
tised on  that  dependent  province."  '^  The  extent  of 
the  salaries,  pensions  and  encroachments  of  the  com- 
pany's service,  civil  and  military,  upon  the  Nawab's 
revenues  and  authority,  says  Warren  Hastings 

"  have  become  an  intolerable  burden  and  exposed 
us  to  the  enmity,  and  resentment  of  the  whole 
country,  by  excluding  the  native  servants  and  ad- 
herents of  the  Vizier  from  the  rewards  of 
their  service  and  attachments.  I  am  afraid  few  men 
would  understand  me  were  I  to  ask  by  what  right  or 
policy  we  levied  a  tax  on  the  Nawab  Vizier  for  the 
benefit  of  patronised  individuals,  and  fewer  still,  if 
I  questioned  the  right  or  policy  of  imposing  upon  him 
an  army  for  his  protection,  which  he  could  not  pay, 
which  he  does  not  want;  with  what  expression  could 
I  tell  him  to  his  face,  '  You  do  not  want  it,  but  you 
shall  pay  for  it ! '  .  .  .  Every  Englishman  in  Oude  was 
possessed  of  an  independent  and  sovereign  authority. 
They  learned  ...  to  claim  the  revenue  of  lacs  "°  as 
their  right,  though  they  could  gamble  away  more  than 
two  lacs  (I  allude  to  a  known  fact)  at  a  sitting.^*' 

The  demands  of  the  English  increased  from  £250,- 
000  to  £700,000  per  annum,  under  Lord  Cornwallis, 
with  a  further  increase  under  Lord  Teignmouth.  In 
1801,  Lord  Wellesley,  under  threat  of  seizing  the 
whole,  extorted  from  the  Nawab  one-half  his  do- 
minions, valued  at  £1,300,000  per  annum.     From  181 5 

28  Mill,  "History  of  India,"  Vol.  V,  p.  316. 
28  A  lac  is  equal  to  a  hundred  thousand  rupees. 
30"  Life  of  W.  Hastings,"  Vol.  H,  p.  458.     Reform  Pam- 
phlet No.  9,  p.  26. 


A  HISTORICAL  RETROSPECT  29 

to  1825  more  than  four  million  pounds  were  extracted 
from  the  Nawab  under  the  name  of  loans,  for  which 
he  received  the  title  of  King,  and  a  territory  little  bet- 
ter than  a  wilderness.  Says  the  Reform  Pamphlet, 
commenting  upon  the  dealings  in  Oude : 

"  This  is  a  brief  history  .  .  .  not  penned  by  those 
who  have  suffered,  but  by  the  doers  themselves.  It  is 
based  upon  facts  that  are  upon  our  records,  and  indis- 
putable. If  Oude  then,  is  misgoverned, —  if  its  people 
are  impoverished  and  oppressed  who  is  to  blame  — 
the  native  sovereigns,  or  those  who  have  thus  trampled 
upon  the  Native  Sovereigns  ?  " 

At  the  time  Lord  Cornwallis,  then  Governor-Gen- 
eral, was  pronouncing  Bengal  to  be  in  process  of  decay 
under  British  mismanagement,  the  Kingdom  of  My- 
sore, under  the  rule  of  Poorneah,  was  in  a  state  of 
high  prosperity,  so  much  so,  that  the  Duke  of  Welling- 
ton pronounced  its  government  worthy  of  applause, 
and  as  a  mark  of  his  approbation,  presented  the  Dewan 
Poorneah  with  his  picture. 

British  publicists  are  fond  of  drawing  the  blackest 
possible  picture  of  India  under  the  administration  of 
the  Mahrattas.  Sevaji,  the  great  founder  of  the  Mah- 
ratta  Empire,  has  been  termed  a  "  robber  "  by  them, 
but  all  classes  of  modern  India  hold  him  in  memory  as 
a  hero  worthy  of  universal  respect.  The  following 
estimate  of  his  character  is  based  on  Grant  Duff's  His- 
tory of  the  Mahrattas,  vol.  11.^^ 

"  The  *  robber,'  Sevajee,  who  entered  upon  the  scene 
in  the  latter  part  of  the  sixteenth  century,  and  who 
shook  the  Mogul  Empire  to  its  foundation  during  the 

31  Vide  the  Reform  Pamphlet,  No.  9,  pp.  14  and  15. 


30  ENGLAND'S  DEBT  TO  INDIA 

reign  of  Aurungzebe,  was  an  able  as  well  as  skilful 
general.  His  civil  government  was  regular,  and  he 
was  vigorous  in  exacting  from  his  provincial  and  vil- 
lage officers  obedience  to  the  rules  he  laid  down  for  the 
protection  of  his  people.  His  enemies  bear  witness  to 
his  anxiety  to  mitigate  the  evils  of  war  by  humane 
regulations,  which  were  strictly  enforced.  Altogether, 
this  robber  hero  has  left  a  character  which  has  never 
since  been  equalled  or  ever  approached  by  any  of  his 
countrymen.  None  of  his  military  successes  raise  so 
high  an  idea  of  his  talents  as  his  domestic  adminis- 
tration, and  the  effect  of  this  appears  to  have  been 
permanent  for  eighty  years  after  his  death." 

Anquetil  du  Perron,  in  his  "  Brief  Account  of  a 
Voyage  to  India,"  published  in  the  Gentleman's  Maga- 
zine of  1762,  gives  an  interesting  glimpse  of  the  state 
of  the  Mahratta  Territory: 

"  From  Surat,  I  passed  the  Ghats,  .  .  .  about  ten  in 
the  morning,  and  when  I  entered  the  country  of  the 
Mahrattas,  I  thought  myself  in  the  midst  of  the 
simplicity  and  happiness  of  the  golden  age,  where 
nature  was  yet  unchanged,  and  war  and  misery  were 
unknown.  The  people  were  cheerful,  vigorous  and 
in  high  health  and  unbounded  hospitality  was  an  uni- 
versal virtue ;  every  door  was  open,  and  friends, 
neighbours  and  strangers  were  alike  welcome  to  what- 
ever they  found." 

The  successors  of  Sevaji  were  also  rulers  of  sagacity 
and  ability.  Bajee  Rao  Bullal  is  said  to  have  united 
the  enterprise,  vigour  and  hardihood  of  a  Mahratta 
chief  with  the  polished  manners,  wisdom  and  address 
which  distinguished  the  Brahmins  of  Concan.  He 
possessed  eloquence,  penetration  and  vigour,  was  sim- 
ple in  his  habits,  a  successful  military  leader,  who  at 


A  HISTORICAL  RETROSPECT  31 

all  times  partook  of  the  privations  of  his  soldiers. 
Ballajee  Rao,  who  succeeded  him,  was  characterised 
by  the  same  political  ability,  devoting,  amid  the  distrac- 
tions of  war,  much  time  to  the  civil  administration  of 
his  territory ;  in  his  reign  the  condition  of  the  popula- 
tion was  improved,  the  system  of  farming  the  revenues 
was  abolished,  and  the  tribunals  of  justice  were  ren- 
dered accessible  to  all.  Following  him  came  Mahdoo 
Rao,  whose  character  as  a  sovereign  was  as  con- 
spicuous as  were  his  military  talents. 

"  He  is  deservedly  celebrated  for  his  firm  support 
of  the  weak  against  the  oppressive,  of  the  poor  against 
the  rich,  and  ,  .  .  for  his  equity  to  all." 

At  that  time,  the  Mahratta  territory  was  more  thriv- 
ing than  any  other  part  of  India.  The  celebrated  Ram 
Shastree  was  the  pure  and  upright  minister  who  served 
Mahdoo  Rao.  The  weight  and  soundness  of  his  judg- 
ments have  made  them  to  this  day  precedents  in  Hindu 
law.  By  his  unwearied  zeal,  he  improved  the  condi- 
tion of  the  people  of  all  ranks.  His  integrity  was 
never  corrupted.  It  was  the  custom  of  this  man  of 
simple  habits,  never  to  keep  in  his  house  more  food 
than  sufficed  for  one  day's  consumption.^^ 

The  territory  of  the  Peishwah  was  administered,  for 
a  quarter  of  a  century,  by  Nana  Furnawese,  during  the 
minority  of  Bajee  Rao.  He  has  been  described  as  a 
minister  of  unequalled  ability,  who  held  together,  by 
force  and  energy  of  mind,  and  the  versatility  of  his 
genius,  the  incongruous  interests  of  his  empire.  The 
wisdom,  firmness  and  moderation  of  his  government 

32  Grant  Duff's  "  History  of  the  Mahrattas,"  Vol.  II,  p.  208. 


32  ENGLAND'S  DEBT  TO  INDIA 

are  testified  to  by  Sir  John  Malcolm,  who  thus  de- 
scribes the  condition  of  the  country: 

"  It  has  not  happened  to  me  ever  to  see  countries 
better  cultivated,  and  more  abounding  in  all  the  pro- 
duce of  the  soil  as  well  as  in  commercial  wealth,  than 
the  southern  Mahratta  districts.  .  .  .  Poonah,  the 
capital  of  the  Peishwah,  was  a  very  wealthy  and  thriv- 
ing commercial  town  and  there  was  as  much  culti- 
vation in  the  Deccan,  as  it  was  possible  an  arid  and 
unfruitful  country  could  admit."  About  another 
large  part  of  the  Mahratta  territory  under  the  sover- 
eignty of  Holkar  we  have  the  testimony  of  the  same 
distinguished  writers: 

"  With  respect  to  Malwa,  I  saw  it  in  a  state  of  ruin, 
caused  by  the  occupancy  ...  of  the  predatory  hordes 
of  India.  Yet,  even  at  that  period,  I  was  surprised 
...  to  find  that  dealings  in  money  to  large  amounts 
had  continually  taken  place  between  cities,  where  bank- 
ers were  in  a  flourishing  state,  and  goods  to  a  great 
extent  continually  passed  through  the  province,  .  .  . 
the  insurance  offices  which  exist  through  all  parts  of 
India  .  .  .  had  never  stopped  their  operations.  ...  I 
do  not  believe  that  in  Malwa  the  introduction  of  our 
direct  rule  could  have  contributed  more,  nor  indeed  so 
much,  to  the  prosperity  of  the  commercial  and  agri- 
cultural interests,  as  the  re-establishment  of  the  effi- 
cient rule  of  its  former  princes  and  chiefs.  With  re- 
spect to  the  southern  Mahratta  districts,  of  whose  pros- 
perity I  have  before  spoken,  ...  I  do  not  think  either 
their  commercial  or  agricultural  interests  likely  to  be 
improved  under  our  rule.  .  .  .  Their  system  of  admin- 
istration is,  on  the  whole,  mild  and  paternal.  I  refer 
their  prosperity  to  be  due  ...  to  the  knowledge  and 
almost  devotion  of  the  Hindus  to  agricultural  pursuit ; 
to  their  better  understanding,  or  better  practice  than  us 
...  in  raising  towns  and  villages  to  prosperity,  from 
the  encouragement  given  to  moneyed  men,  and  the  in- 


A  HISTORICAL  RETROSPECT  33 

troduction  of  capital  .  .  .  but  above  all  causes  which 
promote  prosperity,  is  the  invariable  support  given  to 
the  village  and  other  native  institutions,  and  to  the 
employment,  far  beyond  what  our  system  permits,  of 
all  classes  of  population."^* 

The  isame  writer  praises  the  administration  of  the 
Mahratta  Queen,  Ahalya  Bai,  the  internal  tranquillity 
of  whose  territory  was  as  remarkable  as  her  freedom 
from  foreign  attack.  The  object  of  her  rule  was  to 
promote  the  prosperity  of  all  her  subjects;  she  was 
said  to  rejoice  when  she  saw  bankers,  farmers,  mer- 
chants and  cultivators  rise  to  affluence;  she  was  re- 
garded as  the  model  of  good  government  in  Malwa. 
She  built  several  forts,  and  constructed  a  road  over  the 
almost  perpendicular  Vindhya  range.  Among  the 
princes  of  her  own  nation,  all  would  have  held  it  sacri- 
lege to  become  her  enemy,  or  to  fail  to  defend  her  from 
hostile  attack.^* 

The  dominions  of  the  Rajah  of  Berar,  another  mem- 
ber of  the  great  Mahratta  Confederacy,  were  equally 
flourishing.  European  travellers  comment  on  the 
thriving  districts,  the  industrious  people,  the  fertile 
soil,  the  magnificent  temples  and  the  greatness  of  pub- 
lic works.®^ 

From  the  Mahratta,  let  us  pass  to  other  States.  The 
Reform  Pamphlet  quotes  from  a  report  from  Commis- 
sions upon  the  Northwest  Provinces,  which  it  might  be 
well  to  cite: 

"  In  passing  through  the   Rampore  territory,   we 

33  Reform  Pamphlet  No.  9,  pp.  28,  29. 

34 Malcolm's  "History  of  Central  India,"  Vol.  I,  pp.  176,  195, 
35  See  the  authorities  quoted  in  the  Reform  Pamphlet,  pp. 
32  and  32. 


34  ENGLAND'S  DEBT  JO  INDIA 

could  not  fail  to  notice  the  high  state  of  cultivation  to 
which  it  has  attained  when  compared  with  the  sur- 
rounding country;  scarcely  a  spot  of  land  is  neg- 
lected and  although  the  season  was  by  no  means 
favourably  the  whole  district  seemed  covered  with 
an  abundant  harvest.  .  .  .  The  management  of  the 
Nawab  Fyz-oolah  Kahn  is  celebrated  throughout  the 
country.  It  was  the  administration  of  an  enlightened 
and  liberal  landlord,  who  devoted  his  time  and  atten- 
tion, and  employed  his  own  capital,  in  promoting  the 
prosperity  of  the  country.  When  works  of  magnitude 
were  required  .  .  .  the  means  of  undertaking  them 
were  supplied  from  his  bounty.  Watercourses  were 
constructed,  the  rivulets  made  to  overflow  and  fer- 
tilise the  adjacent  districts,  and  the  paternal  care  of 
a  popular  chief  was  constantly  exerted  to  afford  pro- 
tection to  his  subjects,  to  stimulate  their  exertions, 
to  direct  their  labours  to  useful  objects  and  to  pro- 
mote by  every  means  the  success  of  their  under- 
taking." 

"  If  the  comparison  for  the  same  territory  be  made 
between  the  management  of  the  Rohillas  and  that  of 
our  own  government,  it  is  painful  to  think  that  the 
balance  of  advantage  is  clearly  in  favour  of  the  former. 
After  seven  years'  possession  of  the  country,  it  ap- 
pears by  the  report  that  the  revenue  has  increased  only 
by  two  lacs  of  rupees,  or  20,000  pounds.  The  papers 
laid  before  Parliament  show  that  in  the  twenty  years 
which  have  since  elapsed,  the  collective  revenues  of 
Rohilcund  and  the  districts  forming  the  ceded  prov- 
ince of  Oude,  actually  declined  200,000  pounds  per 
annum ! 

*       *       * 

"  While  the  surrounding  country  seemed  to  have 
been  visited  by  a  desolating  calamity,  the  lands  of  the 
Rajahs  Diaram  and  Bugwaut  Singh  under  every  dis- 
advantage of  season  were  covered  with  crops  pro- 
duced by  better  husbandry  or  greater  labour."     These 


A  HISTORICAL  RETROSPECT  35 

neighbouring  lands  consisted  "■  of  British  territory,  al- 
ready jive  years  in  our  occupation."  ^^ 

Bishop  Heber,  in  his  "  Journal,"  Vol.  II,  pages  yy-f^ 
bears  testimony  to  the  enlightenment  and  prosperity  of 
Oude  at  this  period  under  Saadat  Ali,  whom  he  rates 
as  a  man  of  talents  and  acquirements,  fond  of  business, 
with  a  penchant  for  science.  He  is  described  by  Lord 
Hastings  as  a  sovereign  admirable  for  uprightness, 
humanity  and  mild  elevation.  The  prosperous  condi- 
tion of  the  state  of  Bhurtpore  under  native  rulers  is 
likewise  testified  to.^^ 

"  This  country  ...  is  one  of  the  best  cultivated 
and  watered  tracts  which  I  have  seen  in  India.  The 
crops  of  corn  on  the  ground  were  really  beautiful; 
that  of  cotton  ...  a  very  good  one.  What  is  a  sure 
proof  of  wealth,  I  saw  several  sugar-mills,  and  large 
pieces  of  ground  where  the  cane  had  just  been  cleared. 
.  .  .  The  population  did  not  seem  great,  but  the  vil- 
lages were  in  good  condition  and  repair,  and  the 
whole  afforded  so  pleasing  a  picture  of  industry,  and 
was  so  much  superior  to  anything  I  had  been  led  to 
expect  in  Rajputana,  which  I  had  seen  in  the  Com- 
pany's territories  .  .  .  that  I  was  led  to  suppose  that 
either  the  Rajah  of  Bhurtpore  was  an  extreme  ex- 
emplary and  parental  governor,  or  that  the  system  of 
management  adopted  in  the  British  provinces  was  less 
favourable  to  the  improvement  and  happiness  of  the 
country  than  some  of  the  native  states." 

The  British  Government  itself  emphatically  testifies 
to  the  high  character  of  Pertaub  Singh,  the  first  Rajah 
of  Sattara,  and  the  prosperity  of  his  kingdom.  The 
government  Records  show  a  letter  from  the  Court  of 
Directors  (1843,  No.  569,  page  1268). 

36  Bishop  Heber's  "  Journal,"  Vol.  II,  quoted  by  the  Reform 
Pamphlet. 


36  ENGLAND'S  DEBT  TO  INDIA 

"  We  have  been  highly  gratified  by  the  information 
from  time  to  time  transmitted  to  us  from  our  Govern- 
ment, of  your  Highness's  exemplary  fulfilment  of  the 
duties  of  that  elevated  situation  in  which  it  has  pleased 
Providence  to  place  you. 

"  A  course  of  conduct  so  suitable  to  your  Highness's 
exalted  station,  and  so  well  calculated  to  promote  the 
prosperity  of  your  dominions  and  the  happiness  of 
your  people,  as  that  which  you  have  wisely  and  uni- 
formly pursued,  while  it  reflects  the  highest  honour 
on  your  own  character,  has  imparted  to  our  minds  un- 
qualified pleasure  and  satisfaction.  The  liberality 
which  you  displayed  in  executing  at  your  own  cost, 
various  public  works  of  great  utility  .  .  .  gives  addi- 
tional claim  to  our  approbation,  respect,  and  ap- 
plause." 

While  the  British  Government  was  thus  congratu- 
lating the  Rajah  on  the  prosperity  of  his  dominions,  the 
wretched  state  of  some  thirty  millions  of  natives  under 
British  rule  is  described  by  Dr.  Marshman,  in  The 
Friend  of  India,  April  i,  1852 : 

"  No  one  has  ever  contradicted  the  fact  that 
the  condition  of  the  Bengal  peasantry  is  almost 
as  wretched  and  degraded  as  it  is  possible  to  conceive ; 
living  in  the  most  miserable  hovels,  scarcely  fit  for  a 
dog  kennel,  covered  with  tattered  rags,  and  unable  in 
many  instances,  to  procure  more  than  a  single  meal  a 
day  for  himself  and  family,  the  Bengal  ryot  knows 
nothing  of  the  most  ordinary  comforts  of  life.  We 
speak  without  exaggeration  when  we  say  that  if  the 
real  condition  of  those  who  raise  the  harvest,  which 
yields  between  three  and  four  millions  a  year,  were 
fully  known,  it  would  make  the  ears  of  one  who  heard 
thereof  tingle." 

This,   described  by  an   unimpeachable   eye-witness, 


A  HISTORICAL  RETROSPECT  37 

was  the  condition  of  Bengal,  the  "  Garden  of  Eden  " 
after  almost  a  century  of  British  rule!  If  this  appal- 
ling state  had  been  normal  before  the  English  came, 
what  had  the  Government  been  doing  for  a  century 
not  to  extricate  the  people  from  it? 

But  the  words  of  Clive  are  still  upon  record  — 
"  Bengal,  the  country  of  inexhaustible  riches,  capable 
of  making  its  masters  the  richest  corporation  in  the 
world."  What  can  the  Government  say  for  itself  in 
the  face  of  such  a  result?  Lord  Cornwallis  said,  in  his 
time,  that  the  people  "  were  advancing  hastily  to  a  state 
of  poverty  and  wretchedness."  By  multiplied  exac- 
tions and  heavy  assessments,  from  1765  to  1790  the 
British  revenue  system  enriched  itself  and  left  the 
country  exhausted  and  impoverished.  Governor  Gen- 
eral Lord  Hastings  declared  in  1827  (Pari.  Papers, 
page  157)  : 

"  A  new  progeny  has  grown  up  under  our  hand ; 
and  the  principal  features  of  a  generation  thus  formed 
beneath  the  shade  of  our  regulation,  are  a  spirit  of 
litigation  which  our  judicial  establishments  cannot 
meet,  and  a  morality  certainly  deteriorated." 

As  with  the  judicial  system,  so  with  regard  to  per- 
son and  property.  Protection  was  so  inadequate,  that 
as  stated  in  an  article  in  The  Friend  of  India  (Aug. 
28,  1 851)  "no  man  of  property  .  .  .  can  retire  to  rest 
with  the  certainty  that  he  shall  not  be  robbed  of  it 
before  morning."  Small  wonder  that  Governor-Gen- 
eral Lord  Bentinck  admitted  that  "  Our  administration 
had,  in  all  its  branches,  revenue,  judicial  and  police, 
been  a  failure."  This  was  uttered  in  the  first  half 
of  the  nineteenth  century. 


38  ENGLAND'S  DEBT  TO  INDIA 

Because  of  the  gross  ignorance  on  the  part  of  the 
civiHsed  world,  regarding  the  facts  discussed  at  such 
length,  we  have  quoted  somewhat  lengthily  from 
sources  whose  testimony,  coming  as  it  does,  from  the 
British  camp,  cannot  be  questioned.  British  publi- 
cists continue  in  their  efforts  to  mislea^ihe  publn: 
mind  by  affirmm"g~tHat"EngIand  rescued  India  from  a 
state  of  widespread  anarchy  and  confusion,  and  by 
conferring  upon  her,  for  the  first  time  in  her  history^  a 
settled  government,  saved  her  from  herself^  During 
her  many  ceiitnrres  of'potitical  development,  India_was 
undoubtedly  as  good,  and  as  bad,  as  the  other  evolving 
nations  on  the  face  of  Mother  Earth.  She  prosfiered 
under  her  beneficent  rulers,  and  suffered  under  her  bad 
gnes^;  She  had  her  periods  of  progress,  as  well  as  of 
stagnation.  She  had  times  of  peace  as  well  as  of 
war.  Her  rulers  were  by  no  means  immaculate. 
Her  people  were  not  always  happy.  They  faced  tyr- 
anny and  oppression  as  often  as  good  government  and 
orderly  justice.  Were  a  chart  of  Indian  politics  for 
the  past  three  thousand  years  to  be  compiled,  it  might 
be  found  that  her  eras  of  peace  and  prosperity  per- 
haps exceeded  those  of  any  other  country  in  the  world. 
It  is  futile  to  pass  judgment  upon  the  India  of  the  six- 
teenth century,  from  the  pinnacle  of  twentieth  century 
standards. 

Even  now  there  are  native  states  in  India  which  are 
admittedly  better  governed  than  British  India.  In  sev- 
eral of  them  the  rulers  have  introduced  compulsory 
universal  education,  have  established  representative 
institutions  and,  last  but  not  least,  have  started  indus- 
tries of  their  own  to  give  employment  to  their  subjects. 


A  HISTORICAL  RETROSPECT  39 

Dr.  H.  A.  L.  Fisher,  the  Minister  of  Education  in 
the  Lloyd  George  Cabinet  says  in  his  book  "  The  Em- 
pire and  the  Future,"  "  My  impression  is  that  the  in- 
habitants of  a  well  governed  native  "stafe~are  on  the 
whole  happier  and  more  contented  than  tfieTnFabitants 
of '  British  India.  They  are  moreJi'Qhfly  taxed  ;'~t^^ 
pace  of  the  administration  is  less  urgent  and  exacting ; 
their  sentiment  is  gratified  by  the  splendour  of  a  native 
court  and  by  the  dominion  of  an  Indian  Government. 
They  feel  that  they  do  things  for  themselves  instead 
of  having  everything  done  for  them  by  a  cold  and  alien 
benevolence."  [Italics  mine.  L.  R.]  We  are  sorry 
that  consideration  of  space  should  have  forced  us  to 
abridge  many  of  the  references  given  in  this  chapter. 
Independent  enquirers  are  respectfully  referred  to  the 
authorities  quoted  from. 


PART  TWO 


CHAPTER  II 

INDIA  AND   THE  BRITISH    INDUSTRIAL   REVOLUTION 

Before  Plassy.  That  India  played  a  very  definite 
part  in  the  success  of  the  British  Industrial  Revohition, 
is  a  fact  almost  universally  acknowledged ;  jft  how 
great  a  part  India  played  in  making  for  the  industrial 
and  economic  prosperity  of  Great  Britain  is  knovyn  to 
very  few^_J[tJs_5jyLr.putpose  tO--discuss..that  p^»*^ 
this  chapter. 

Let  us  consider  first  the  respective  economic  posi- 
tions of  India  and  England  at  the  time  when  the  In- 
dustrial Revolution  was  brought  about  by  the  invention 
of  the  steam  engine  and  of  mechanical  contrivances 
for  the  spinning  and  weaving  of  cloth. 

We  have  already  given  the  reader  an  idea,  in  the 
introductory  chapter,  of  the  economic  prosperity  of 
India  in  pre-British  days^Tn~tHe~seventeenth  and 
eighteenth  centuries,  India  had  enormous  weaitli4_.the 
treasuries  of  her  rulers  were  full  of  money,  bullion 
and  precious  stones  of  fabulous  value ;  her  industries 
and  manufactures  flourished,  and  she  exported  large 
quantities  of  goods  in  return  for  payment  in  gold  and 
silver.  Her  trade  with  Asia,  Europe  and  Africa  was 
extensive,  and  she  made  enormous  profits,  from  the 
sale  of  her  manufactured  goods.  Her  cotton  muslins, 
manufactured  silks,  woollen  shawls,  brass  and  bronzes 

43 


44  ENGLAND'S  DEBT  TO  INDIA 

had  made  her  famous,  all  through  Asia  and  Europe. 

For  centuries,  the  maritime  nations  of  Europe  had 
been  trying  to  find  a  sea  route  to  India  in  order  to  profit 
by  trading  with  her  and  possibly  with  the  motive  of 
eventually  conquering  her.  The  discovery  of  America 
was  only  an  accident.  The  goal  which  Columbus  had 
in  view  was  India.  It  is  well  known  how,  after  Co- 
lumbus, the  Dutch  and  the  Portuguese  navigators  kept 
up  their  search  for  a  sea  route  to  India  until  the  ef- 
forts of  Vasco  da  Gama  bore  fruit  when  he  discovered 
the  route  around  the  Cape  of  Good  Hope.  For  a  long 
time  before  the  East  India  Company  was  founded  the 
Portuguese  and  the  Dutch  shippers  had  been  making 
enormous  profits  from  the  Indian  trade.  The  East  In- 
dia Company  began  its  operations  in  1603.  In  the  first 
eighty  years  of  its  enterprise  the  company  made  a  profit 
of  171  per  cent,  per  annum  on  its  investment.  The 
details  of  its  imports  and  exports  show  that  while  it 
took  raw  silk,  fine  calicoes,  indigo,  cloves  and  mace 
from  India,  it  brought  to  India  only  bullion.  It  was 
in  1613  that  the  British  East  India  traders  first  in- 
corporated themselves  into  a  sort  of  joint  stock  con- 
cern. Writing  of  that  time,  J.  Bruce  says  ^  that  the 
continent  of  India  was  "  the  seat  of  the  most  extensive 
and  splendid  monarchies  on  the  surface  of  the  globe." 

In  the  four  years  following  the  incorporation,  the 
character  of  the  trade  of  the  East  India  Company  re- 
mained unchanged,  though  its  profits  were  greatly  re- 
duced, reaching  the  modest  figure  of  87J/2  per  cent. 

Then  came  the  embassy  of  Sir  Thomas  Roe  in  1614 

^  "  Annals  of  the  East  India  Co.,"  by  J.  Bruce,  Vol.  I,  p.  166; 
quoted  by  James  Mill  in  his  History,  Vol.  I,  p.  30. 


INDUSTRIAL  REVOLUTION  45 

which  resulted  in  the  grant  by  the  Mogul  Emperor  of 
Delhi,  to  the  East  India  Company,  of  "  the  liberty  of 
trading  and  establishing  factories  in  any  part  of  the 
Mogul  dominions ;  Surat,  Bengal  and  Sindh  being  par- 
ticularly named." 

At  that  time  the  Dutch  and  the  Portuguese  claimed 
the  monopoly  of  the  Eastern  trade.  The  English  Com- 
pany had  several  naval  encounters  and  military  en- 
gagements with  them  in  parts  of  Asia.  In  India,  these 
Portuguese  and  Dutch  traders  maintained  forts  and 
garrisons  by  which  they  not  only  protected  their  fac- 
tories but  established  a  certain  prestige  in  the  eyes  of 
the  native  rulers,  which  helped  them  in  their  business. 
The  English  wanted  to  follow  their  example  and  plant 
forts  and  garrisons  as  well,  but  Sir  Thomas  Roe  per- 
suaded them  not  to  do  so,  on  the  ground  that  the  ex- 
pense of  doing  so  would  reduce  their  profits. 

We  are  told  that  in  1617  "  Cloths  of  India  could  best 
be  obtained  at  Surat,  though  nothing  could  be  disposed 
of,  in  return,  except  China  goods,  spices  and  money."  ^ 
For  more  than  a  century  and  a  half,  the  English 
trade  in  India  consisted  mainly  of  the  export  of  cotton 
and  silk  goods,  indigo  and  spices  in  return  for  bullion. 
During  this  period  India  imported  practically  nothing. 
Bruce  says  that  "  on  the  average  of  ten  years,  from 
1747  to  1757,  £562,423  bullion  was  exported  to  India, 
but  after  that  year  bullion  was  no  longer  exported 
there."  ^ 

How    the    East    India    Company    made    enormous 

2  Mill,  Vol.  I,  p.  37. 

3  "  Plans  for  British  India,"  by  J.  Bruce,  p.  316.  See  also 
"  Outlines  of  English  Industry,"  by  Cunningham  and  McAr- 
thur,  Cambridge  University  Press,  1895,  p.  128. 


46  ENGLAND'S  DEBT  TO  INDIA 

profits  (perfectly  legitimate)  from  this  trade  is  told  by 
all  the  historians  of  the  time.     Macaulay  says :  * 

"  The  company  enjoyed  during  the  greater  part  of 
the  reign  of  Charles  II,  a  prosperity  to  which  the  his- 
tory of  trade  scarcely  furnished  any  parallel  and  which 
excited  the  wonder,  the  cupidity  and  the  envious  ani- 
mosity of  the  whole  capital  (London).  .  .  .  During 
the  twenty-three  years  that  followed  the  Restoration 
the  value  of  the  annual  imports  from  that  rich  and 
popular  district  (the  Delta  of  the  Ganges)  increased 
from  £8000  to  £300,000."  And  he  adds  that  "  the 
gains  of  the  body  (i.e.,  the  company)  were  almost  in- 
credible .  .  .  the  profits  were  such  that  in  1676  every 
proprietor  received  as  a  bonus  a  quantity  of  stock  equal 
to  that  which  he  held.  On  the  capital  thus  doubled 
were  paid,  during  five  years,  dividends  amounting  to 
an  average  of  20  per  cent,  annually." 

In  1677  the  price  of  the  stock  was  245  for  every  one 
hundred.  In  1681  it  rose  to  300  and  later  to  360  and 
500.  The  only  limitations  to  the  profits  of  the  com- 
pany were  the  exactions  of  the  English  crown,  the  de- 
mands of  the  English  Exchequer,  and  the  dishonesty 
of  its  servants. 

At  that  time  the  balance  of  trade  was  entirely  in 
favour  of  India.  The  British  historian,  Orme,  in  his 
"  Historical  Fragments  "  says  that  the  manufacture  of 
cotton  goods  was  almost  universal  throughout  India. 
The  rupee,  which  now  sells  for  is.  4d.,  was  then 
worth  2s.  8d.  Such  was  the  economic  condition  of 
India. 

Let  us  now  consider  the  economic  condition  of  Eng- 

*  Macaulay's  "  History  of  England,"  Vol.  V,  p.  2094. 


INDUSTRIAL  REVOLUTION  47 

land.  "  In  the  sixteenth  century,"  says  Robertsorij 
"  England  was  a  backward  country,  and  capitaHsts 
seeking  investments  looked  towards  it  from  all  the 
monetary  centres." 

"  Early  in  the  seventeenth  century,"  says  Mill,  "  the 
English,  whose  country,  oppressed  by  misgovernment 
or  scourged  by  civil  war,  afforded  little  capital  to  ex- 
tend trade,  or  protect  it,  were  unequal  competitors  of 
the  Dutch." 

By  the  end  of  the  seventeenth  century,  conditions 
had  become  alarmingly  acute,  not  only  in  England,  but 
throughout  Europe,  as  has  been  shown  by  Brooks 
Adams.  Adams  says  that  towards  the  close  of  the 
seventeenth  century  Europe  appeared  to  be  on  the 
brink  of  a  contraction  of  money,  due  partly  to  the  con- 
stant drain  to  Asia  and  the  increasing  demands  of  com- 
merce. From  the  reign  of  Augustus  commerce  be- 
tween Europe  and  Asia  had  usually  favoured  Asia. 
The  lack  of  money  led  to  a  considerable  depreciation 
of  currency  in  England. 

Speaking  of  the  time  of  the  Revolution  Ruding  says : 
"  At  that  time  the  diminution  of  the  value  of  money 
and  counterfeiting  had  been  so  excessive  that  what  was 
good  silver  was  worth  scarcely  one-half  of  the  current 
value,  and  a  great  part  of  the  coins  was  only  iron, 
brass,  or  copper  plated,  and  some  no  more  than  washed 
over." 

In  the  decade  between  1710-1720  the  actual  export 
of  bullion  by  the  East  India  Company  averaged  £4,344,- 
000. 

The  story  of  how  England  supplied  her  needs  at  this 
time  is  one  of  the  most  dramatic  pages  of  history.    As 


48  ENGLAND'S  DEBT  TO  INDIA 

Jevons  has  observed,  "  Asia  is  the  great  reservoir  and 
sink  of  the  precious  metals."  From  time  immemorial 
the  oriental  custom  has  been  to  hoard,  and  from  the 
Mogul  blazing  with  the  diamonds  of  Golconda,  to  the 
peasant  starving  on  his  wretched  pittance,  every  Hindu 
had,  in  former  days,  a  treasure  stored  away  against  a 
day  of  trouble.  "  These  hoards,  the  savings  of  mil- 
lions of  human  beings  for  centuries,  the  Eyiglish  seized 
and  took  to  Londoti,  as  the  Romans  had  taken  the 
spoils  of  Greece  and  Pontus  to  Italy.  What  the  value 
of  the  treasure  was,  no  man  can  estimate  hut  it  must 
have  been  many  millions  of  pounds  —  a  vast  sum  in 
proportion  to  the  stock  of  the  precious  metals  theft 
owned  by  European."  ^ 

We  have  already  pointed  out  on  the  authority  of 
Bruce  that  the  last  export  of  bullion  from  England  to 
India  took  place  in  1757,  the  year  in  which  the  battle 
of  Plassy  was  fought.  After  that,  bullion  was  no 
longer  exported  to  India.  "  From  this  period  on,  the 
export  of  bullion  to  China  very  considerably  decreased 
and  it  was  only  sent  occasionally  after  the  supply  from 
India  failed.  This  circumstance  was  explained  in 
every  letter  sent  by  the  directors  to  their  servants  at 
Madras  and  Bengal,  which  contained  instructions  to 
them  to  collect  as  much  bullion  as  they  could,  to  be 
ready  for  ships  which  would  come  out  from  Madras 
and  China,  and  by  the  answers  to  the  letters  specifying 
the  quantity  sent  by  the  different  vessels."  ^ 

The  circumstances  in  India  at  that  time  were  very 
favourable  to  the  collection  of  bullion  by  the  servants 

^Brooks  Adams  in  "The  Law  of  Civilisation  and  Decay,"  p. 
305. 
^J.  Bruce,  "Plans  for  British  India,"  pp.  314-315. 


INDUSTRIAL  REVOLUTION  49 

of  the  East  India  Company.  In  the  words  of  Ma- 
caulay,  "  Treasure  flowed  to  England  in  oceans ;  "  and 
what  was  lacking  in  England  to  make  the  fullest  pos- 
sible use  of  the  mechanical  inventions  made  by  Watt 
and  others,  was  supplied  by  India.  The  influx  of 
Indian  treasure  added  considerably  to  England's  cash 
capital. 

Brooks  Adams  remarks  that  after  Plassy  the  Bengal 
plunder  began  to  arrive  in  London  and,  "  the  effect 
appears  to  have  been  instantaneous,  for  all  authorities 
agree  that  the  Industrial  Revolution  —  the  current 
which  divided  the  nineteenth  century  from  all  antece- 
dent time  —  began  with  the  year  1760." 

It  is  an  historic  fact  that  prior  to  that  time  the  ma- 
chinery used  for  spinning  cotton  in  Lancashire  was  as 
simple  as  it  was  in  India.  It  was  in  1760  that  the 
flying-shuttle  was  invented.  Hargreave  invented  the 
spinning  jenny  in  1764,  Compton  invented  the  mule  in 
1779,  Cartwright  in  1795  patented  the  power-loom, 
and  Watt  brought  his  steam  engine  to  completion  in 
1768.  Had  these  inventions  been  matured  fifty  years 
before  the  influx  of  Indian  treasure  and  the  expansion 
of  credit  which  followed  such  masses  of  capital,  they 
and  their  inventors  would  probably  have  perished  for 
want  of  sufficient  money  to  set  them  going,  for  it 
should  be  borne  in  mind  that  the  factory  system  was 
not  the  father  of  the  industrial  revolution  but  the  child 
thereof.  In  short,  the  accumulated  masses  of  Indian 
treasure  liberated  the  machines  to  furnish  an  outlet 
for  the  movement  of  the  time.  Adams  points  out  how 
agriculture  also  was  impelled  by  this  new  force. 

A  credit  system  based  on  Indian  metal  sprang  up  in 


50  ENGLAND'S  DEBT  TO  INDIA 

England,  and  the  agriculturists  who  could  borrow,  im- 
ported cattle  and  improved  tillage.  This  movement 
resulted  in  increasing  the  value  of  land.  The  wastes 
were  enclosed,  thus  making  the  position  of  the  yeo- 
manry almost  unbearable  and  provoking  the  far-reach- 
ing social  revolution  of  the  time. 

England,  favoured  as  she  was  with  coal  and  iron 
mines  and  with  credit,  the  easy  vehicle  of  energy,  soon 
dominated  the  European  and  American  market  and 
even  undersold  Hindu  labour  at  Calcutta. 

It  is  clear  then  that  the  "  Industrial  Revolutipn,"  the, 
foundation  on  which  England^  econpnii^j^qsperity 
was  built  up,~  was  made  possible  onlv  bv  the  influx  of 
Indian  treasure._and  thatbut  for  this  capital^  not 
inanprf^  h^^t_^Jf^^  ripd  ^^^^'m^  "o  iutcrcst,  the  as- 
cendency  of  the  steam  engine  and  mech^ical  appli- 
ances for  mass  production,  might  have  remained  un- 
utilised.     Engjand''s'gain  w^f  ^"A''?\  1n5s,i:^;;_aJoss  of 

trpgjiirp  mnrp  fhan  pnnngVi  tr>  «;tafYq^hier  industries  and 

retard  the  progress  of  agriculture.  No  countrv.~hbw- 
ever  rich  or  resourceful,  could  bear  such  a  dramun- 
harrned^  ~^ 

The  wound  inflicted  by  wholesale  exportation  of  In- 
dia's wealth,  was  deepened  by  the  way  in  which  the 
treasure  was  collected.  The  wealth  which  England  de- 
rived from  India  and  invested  in  her  industries  at 
home,  or  otherwise  used  to  her  profit,  may  be  classified 
thus: 

I.  Tributes  and  gratuities  obtained  from  Indian 
rulers  and  potentates,  in  the  name  of,  and  for 
the  East  India  Company. 


INDUSTRIAL  REVOLUTION  51 

2.  Taxes  raised  from  the  people  in  the  name  of,  and 

for  the  East  India  Company. 

3.  The  profits  of  internal  trade  carried  on  by  the 

servants  of  the  East  India  Company  in  their 
own  interests. 

4.  Bribes  and  gratuities  obtained  from  the  Native 

rulers,  their  relatives  and  connections  who  had 
any  dealings  with  the  East  India  Company. 
Some  of  these  emoluments  were  obtained 
openly,  others  surreptitiously  and  by  extortion. 

Part  of  the  money  thus  raised  went  to  England  in 
the  shape  of  goods  purchased  from  India  for  sale  in 
England  and  elsewhere;  the  rest  went  in  cash.  For 
better  understanding,  the  period  may  be  considered 
under  two  divisions : 

1.  The    economic    effects    of    the    battle    of    Plassy, 

1757-60,  under  the  governorship  of  Clive,  and  the 
revolutions  and  changes  that  took  place  in  Bengal, 
1760-65,  during  the  absence  of  Clive  in  England. 

2.  Clive's  second  administration,  1765-67. 

I.  Effects  of  Plassy.  The  victory  of  Plassy  was 
followed  by  a  treaty  with  Mir  Jafifar  by  which  the  latter 
agreed  to  pay  to  the  East  India  Company  about  one  and 
three-quarters  millions  pounds  sterling,  in  cash,  be- 
sides large  tracts  of  land  in  permanent  ownership.''     In 

''  In  addition  to  the  sums  defined  in  the  treaty,  Mir  Jaffar 
after  his  enthronement  made  large  gifts  to  the  highest  servants 
of  the  Company.  The  Select  Committee  of  1772  estimated  the 
amount  of  these  gifts  at  £1,250,000,  of  which  Clive  received 
£234,000  (Third  Report,  p.  311).  But  these  were  only  "gifts 
proved  and  acknowledged."  In  1759  Clive  further  received 
as  a  jaghir  or  estate,  the  right  of  receiving  from  the  Com- 
pany the  tribute  due  from  it  for  the  territories  referred  to  in 
the  treaty  as  "  the  24  parganas  "  or  districts.  Mir  Jaffar  also 
bequeathed  him  five  lacs  of  rupees,  £50,000  which  he  made  over 
to  the  Company  as  a  fund  for  pensioning  disabled  soldiers. 
See  Muir,  "  The  Making  of  British  India,"  p.  59. 


52  ENGLAND'S  DEBT  TO  INDIA 

his  "  Essay  on  Clive,"  Macaulay  has  left  a  graphic  de- 
scription of  the  "  shower  of  wealth "  that  began  to 
fall  after  Plassy. 

Within  less  than  three  years  from  this  treaty,  Mir 
Jaffar  was  declared  a  failure;  during  his  rule,  the 
greed  and  rapacity  of  the  servants  of  the  Company 
found  full  play,  and  Bengal  was  in -a  condition  of  an- 
archy. This  state  of  things  was  the  direct  result  of 
the  conduct  of  the  Company's  servants.     Muir  says : 

"  The  only  persons  who  profited  by  these  conditions 
were  the  individual  servants  of  the  Company,  who 
found  no  check  or  control  exercised  over  their  high- 
handed pursuit  of  private  profit."  ^ 

A  change  being  necessary,  Mir  Jaffar  was  deposed, 
and  his  son-in-law,  Mir  Kassim,  installed  as  Nabob. 
In  return  for  this  service,  he  ceded  to  the  British  three 
of  the  most  prosperous  districts  of  Bengal, —  Burdwan, 
Midnapur  and  Chittagong, —  in  lieu  of  paying  the 
army,  which  he  was  unable  to  do,  his  revenues  being 
sadly  depleted  by  the  ravages  and  piratical  demands  of 
his  masters,  the  servants  of  the  Company.  He  also 
agreed  to  pay  the  balance  of  Mir  Jafifar's  unpaid  ac- 
count, and  gave  an  extra  present  of  five  lacs  of  rupees, 
£50,000  to  help  pay  the  expenses  of  the  Company's 
wars  in  the  south.  The  amount  given  in  presents  to 
the  English  officers  on  this  occasion  totalled  £200,269, 
—  of  which  the  governor  took  £58,333.  Mir  Kas- 
sim met  his  engagements  with  the  Company,  and  in 
less  than  two  years,  had  faithfully  discharged  his  ob- 
ligations. 

Mir  Kassim  proved  an  unexpected  set  back  to  the  de- 

8  "  The  Making  of  British  India,"  p.  59. 


INDUSTRIAL  REVOLUTION  53 

signs  of  the  British  merchants.  In  place  of  being  a 
mere  tool  in  their  hands,  he  turned  out  to  be  a  far  more 
efficient  ruler  than  Mir  Jaffar,  and  brought  about  a 
great  improvement  in  conditions.  But  in  the  language 
of  Professor  Muir: 

"  He  was  never  given  a  fair  chance.  From  the  out- 
set he  was  an  object  of  suspicion  and  hostility  on  the 
part  of  the  majority  of  the  Calcutta  Council.  They 
disliked  the  change  from  the  nerveless  rule  of  Mir 
Jaffar,  because  it  interfered  with  their  profits;  and 
especially  they  resented  the  attempt  to  levy  tolls  on 
the  trade  carried  on  for  their  profit  by  the  Indian 
gomastas." 

Governor  Verelst  has  left  it  on  record  that : 

"  A  trade  was  carried  on  without  payment  of  duties, 
in  the  prosecution  of  which  infinite  oppressions  were 
committed.  English  agents  or  Gomastahs,  not  con- 
tented with  injuring  the  people,  trampled  on  the  au- 
thority of  government,  binding  and  punishing  the 
Nabob's  officers  whenever  they  presumed  to  interfere. 
This  was  the  immediate  cause  of  the  war  with  Meer 
Cossim."  * 

A  corroboration  of  this  is  furnished  by  the  letter  of 
Warren  Hastings  to  the  Governor  on  April  25,  1762 : 

"  I  beg  leave  to  lay  before  you  a  grievance  which 
loudly  calls  for  redress,  and  will,  unless  duly  attended 
to,  render  ineffectual  any  endeavours  to  create  a  firm 
and  lasting  harmony  between  the  Nabob  and  the  Com- 
pany. I  mean  the  oppression  committed  under  the 
sanction  of  the  English  name.  ...  I  have  been  sur- 
prised to  meet  with  several  English  flags  flying  in 
places  which  I  have  passed,  and  on  the  river  I  do  not 

9  Quoted  by  Romesh  Dutt,  "  India  Under  Early  British 
Rule,"  p.  20. 


54  ENGLAND'S  DEBT  TO  INDIA 

believe  I  passed  a  boat  without  one.  By  whatever  title 
they  have  been  assumed  (for  I  could  trust  to  the  in- 
formation of  my  eyes  without  stopping  to  ask  ques- 
tions), I  am  sure  their  frequency  can  bode  no  good 
to  the  Nabob's  revenues,  the  quiet  of  the  country,  or 
the  honour  of  our  nation,  but  eventually  tends  to  les- 
sen each  of  them.  A  party  of  Sepoys  who  were  on 
the  march  before  us  afforded  sufficient  proofs  of  the 
rapacious  and  insolent  spirit  of  those  people  where 
they  are  left  to  their  own  discretion.  Many  com- 
plaints against  them  were  made  me  on  the  road,  and 
most  of  the  petty  towns  and  Serais  were  deserted  at 
our  approach  and  the  shops  shut  up  from  the  appre- 
hensions of  the  same  treatment  from  us.  You  are 
sensible,  sir,  that  it  is  from  such  little  irregularities, 
too  trivial  perhaps  for  public  complaint  and  continually 
repeated,  that  the  country  people  are  habituated  to 
entertain  the  most  unfavourable  notions  of  our  govern- 
ment." ^'^ 

From  the  protests  of  the  Nabob  of  Bengal  we  quote 
only  one  extract,  viz.,  the  one  contained  in  his  letter 
written  in  May,  1762: 

"  In  every  Perganah,  every  village,  and  every  fac- 
tory, they  (the  Company's  Gomastahs)  buy  and  sell 
salt,  betel-nut,  ghee,  rice,  straw,  bamboos,  fish,  gun- 
nies, ginger,  sugar,  tobacco,  opium,  and  many  other 
things,  more  than  I  can  write,  and  which  I  think  it 
needless  to  mention.  They  forcibly  take  away  the 
goods  and  commodities  of  the  Reiats,  merchants,  etc., 
for  a  fourth  part  of  their  value ;  and  by  ways  of  vio- 
lence and  oppressions  they  oblige  the  Reiats,  etc.,  to 
give  five  rupees  for  goods  which  are  worth  but  one 
rupee.  .  .  .  The  officers  of  every  district  have  desisted 
from  the  exercise  of  their  functions ;  so  that  by  means 

1"  Quoted  by  Romesh  Dutt,  "  India  Under  Early  British 
Rule,"  p.  21. 


INDUSTRIAL  REVOLUTION  55 

of  these  oppressions,  and  my  being  deprived  of  my 
duties,  I  suffer  a  yearly  loss  of  nearly  twenty-five 
lakhs  of  Rupees.  ...  By  the  grace  of  God,  I  neither 
have  transgressed,  nor  do,  nor  will  transgress  the 
treaty  and  agreement  which  I  have  made;  why  then 
do  the  chiefs  of  the  Englishmen  render  my  government 
contemptible  and  employ  themselves  in  bringing  a  loss 
upon  me  ?  "  ^^ 

But  a  more  graphic  description  is  to  be  found  in  a 
letter  from  Sergeant  Brago : 

"  A  gentleman  sends  a  Gomastah  here  to  buy  or 
sell ;  he  immediately  looks  upon  himself  as  sufficient  to 
force  every  inhabitant  either  to  buy  his  goods  or  sell 
him  theirs;  and  on  refusal  (in  case  of  non-capacity) 
a  flogging  or  confinement  immediately  ensues.  This 
is  not  sufficient  even  when  willing,  but  a  second  force 
is  made  use  of,  which  is  to  engross  the  different 
branches  of  trade  to  themselves,  and  not  to  suffer  any 
person  to  buy  or  sell  the  articles  they  trade  in ;  and  if 
the  country  people  do  it,  then  a  repetition  of  their 
authority  is  put  in  practise;  and  again,  what  things 
they  purchase,  they  think  the  least  they  can  do  is  to 
take  them  for  a  considerable  deal  less  than  another 
merchant,  and  oftentimes  refuse  paying  that;  and  my 
interfering  occasions  an  immediate  complaint.  These, 
and  many  other  oppressions  more  than  can  be  related, 
which  are  daily  used  by  the  Bengal  Gomastahs,  is  the 
reason  that  this  place  ( Backer]  unj,  a  prosperous  Ben- 
gal district)  is  growing  destitute  of  inhabitants;  every 
day  numbers  leave  the  town  to  seek  a  residence  more 
safe,  and  the  very  markets,  which  before  afforded 
plenty,  do  hardly  now  produce  anything  of  use,  their 
peons  being  allowed  to  force  poor  people ;  and  if  the 
Zemindar  offers  to  prevent  it,  he  is  threatened  to  be 

"Quoted  by  Romesh  Dutt,  "India  Under  Early  British 
Rule,"  p.  23. 


56  ENGLAND'S  DEBT  TO  INDIA 

used  in  the  same  manner.  Before,  justice  was  given 
in  the  pubhc  Catcheree,  but  now  every  Gomastah  is 
become  a  judge,  and  every  one's  house  a  Catcheree; 
they  even  pass  sentences  on  the  Zemindars  themselves, 
and  draw  money  from  them  by  pretended  injuries, 
such  as  a  quarrel  with  some  of  the  peons,  or  their 
having,  as  they  assert,  stole  something,  which  is  more 
likely  to  have  been  taken  by  their  own  people."  ^^ 

One  more  quotation  from  William  Bolts,  an  Eng- 
lish merchant,  and  we  have  done  with  this  part  of  this 
sad  story: 

"  It  may  with  truth  be  now  said  that  the  whole  in- 
land trade  of  the  country,  as  at  present  conducted,  and 
that  of  the  Company's  investment  for  Europe  in  a  more 
peculiar  degree,  has  been  one  continued  scene  of  op- 
pression; the  baneful  efifects  of  which  are  severely  felt 
by  every  weaver  and  manufacturer  in  the  country, 
every  article  produced  being  made  a  monopoly ;  in 
which  the  English,  with  their  Banyans  and  black  Go- 
mastahs,  arbitrarily  decide  what  quantities  of  goods 
each  manufacturer  shall  deliver,  and  the  prices  he  shall 
receive  for  them.  .  .  .  Upon  the  Gomastah's  arrival 
at  the  Aurung,  or  manufacturing  town,  he  fixes  upon 
a  habitation  which  he  calls  his  Catcherry ;  to  which,  by 
his  peons  and  hircarahs,  he  summons  the  brokers, 
called  dallals  and  pykars,  together  with  the  weavers, 
whom,  after  receipt  of  the  money  despatched  by  his 
masters,  he  makes  to  sign  a  bond  for  the  delivery  of  a 
certain  quantity  of  goods,  at  a  certain  time  and  price, 
and  pays  them  a  certain  part  of  the  money  in  advance. 
The  assent  of  the  poor  weaver  is  in  general  not  deemed 

12  Quoted  by  Romesh  Dutt,  "  India  Under  Early  British 
Rule,"  pp.  23,  24. 


INDUSTRIAL  REVOLUTION  57 

necessary;  for  the  Gomastahs,  when  employed  on  the 
Company's  investment,  frequently  make  them  sign 
what  they  please ;  and  upon  the  weavers  refusing  to 
take  the  money  offered,  it  has  been  known  they  have 
had  it  tied  in  their  girdles,  and  they  have  been  sent 
away  with  a  flogging.  ...  A  number  of  these  weavers 
are  generally  also  registered  in  the  books  of  the  Com- 
pany's Gomastahs,  and  not  permitted  to  work  for  any 
others,  being  transferred  from  one  to  another  as  so 
many  slaves,  subject  to  the  tyranny  and  roguery  of 
each  succeeding  Gomastah.  .  .  .  The  roguery  practised 
in  this  department  is  beyond  imagination;  but  all  ter- 
minates in  the  defrauding  of  the  poor  weaver ;  for  the 
prices  which  the  Company's  Gomastahs,  and  in  con- 
federacy with  them  the  Jachendars  (examiners  of  fa- 
brics) fix  upon  the  goods,  are  in  all  places  at  least  15 
per  cent.,  and  some  even  40  per  cent,  less  than  the 
goods  so  manufactured  would  sell  in  the  public  bazaar 
or  market  upon  free  sale.  .  .  .  Weavers,  also,  upon 
their  inability  to  perform  such  agreements  as  have  been 
forced  upon  them  by  the  Company's  agents,  universally 
known  in  Bengal  by  the  name  of  Mutchulcahs,  have 
had  their  goods  seized  and  sold  on  the  spot  to  make 
good  the  deficiency ;  and  the  winders  of  raw  silk,  called 
Negoads,  have  been  treated  also  with  such  injustice, 
that  instances  have  been  known  of  their  cutting  off 
their  thumbs  to  prevent  their  being  forced  to  wind 
silk." 

But  agriculture  also  declined  in  Bengal  under  this 
system. 

"  For  the  ryots,  who  are  generally  both  land-holders 
and  manufacturers,  by  the  oppressions  of  Gomastahs 


58  ENGLAND'S  DEBT  TO  INDIA 

in  harassing  them  for  goods  are  frequently  rendered 
incapable  of  improving  their  lands,  and  even  of  pay- 
ing their  rents ;  for  which,  on  the  other  hand,  they 
are  again  chastised  by  the  officers  of  the  revenue,  and 
not  infrequently  have  by  those  harpies  been  necessi- 
tated to  sell  their  children  in  order  to  pay  their  rents, 
or  otherwise  obliged  to  fly  the  country."  ^^ 

In  fairness  to  Warren  Hastings  and  the  Governor 
Vansittart,  it  may  be  said  that  they  recognised  the  force 
of  the  Nabob's  complaints  and  tried  to  persuade  their 
colleagues  in  Bengal  to  put  matters  right.  But  self- 
interest  and  greed  prevented  the  latter  from  seeing  the 
justice  of  the  Nabob's  complaints  and  the  soundness  of 
the  proposals  submitted  by  Warren  Hastings  and  Van- 
sittart in  consultation  with  the  Nabob  to  put  an  ef- 
fective check  on  the  company's  servants.  The  Coun- 
cil rejected  these  proposals  and  when  the  Nabob  heard 
of  the  rejection,  he  in  a  moment  of  "  noble  indignation 
and  under  an  impulse  of  high-minded  patriotism  "  re- 
solved to  sacrifice  his  revenues  by  abolishing  all  inland 
duties  so  that  his  subjects  might  have  a  chance  of  carry- 
ing on  inland  trade  on  equal  terms  with  the  servants 
of  the  East  India  Company.  What  the  English  mer- 
chants wanted,  however,  was  monopoly  and  not  equal 
opportunity.  They  accordingly  protested  against  this 
action  of  the  Nabob  and  made  his  protest  the  basis  of  a 
quarrel  with  him  which  eventually  led  to  war.  "  The 
conduct  of  the  Company's  servants  upon  this  occasion," 
says  James  Mill  in  his  "  History  of  British  India," 
"  furnishes  one  of  the  most  remarkable  instances  upon 

^3  Quoted  by  Romesh  Dutt,  "  India  Under  Early  British 
Rule,"  pp.  25,  26,  27. 


INDUSTRIAL  REVOLUTION  59 

record  of  the  power  of  interest  to  extinguish  all  sense 
of  justice  and  even  of  shame." 

The  move  resulted  in  the  defeat  of  Mir  Kassim,  who 
in  a  fit  of  fury  caused  the  English  prisoners  at  Patna 
to  be  massacred  and  then  left  his  dominions  for  good. 
Mir  Jaffar,  the  old  puppet  who  had  a  few  years  before 
been  declared  a  failure,  was  again  set  up  as  Nabob, 
but  he  died  shortly  after,  and  his  illegitimate  son 
Najm-uddaula  was  hastily  created  Nabob  in  1765. 

On  these  occasions  the  presents  which  the  English 
officers  received  from  Mir  Jaffar  and  his  illegitimate 
son  amounted  to  £500,165  and  £230,356  respectively. 
Besides  these  amounts  received  in  presents  (amounting 
within  eight  years  to  £2,169,665)  other  sums  amount- 
ing to  £3,770,833  were  claimed  and  obtained  as  "  resti- 
tution "  within  this  period.^*  This  amount  was  in  ad- 
dition to  the  income  which  the  Company  derived  from 
the  territories  made  over  to  them  by  the  Nabobs,  as 
well  as  the  amounts  agreed  to  be  given  under  the  dif- 
ferent treaties  as  subsidies,  gratuities  and  expenses  of 
maintaining  the  army. 

2.  The  Second  Administration  of  Lord  Clive. 
When  the  reports  of  the  misdoings  of  their  servants  in 
India  reached  the  directors  of  the  East  India  Company 
in  London  they  prevailed  upon  Lord  Clive  to  return  to 
India  and  set  matters  right.  They  seem  to  have  been 
sincerely  shocked  at  the  turn  things  had  taken  and 

1*  "  House  of  Commons  third  report,  1773,"  p.  311,  quoted  by 
Romesh  Dutt  in  his  "  India  Under  Early  British  Rule."  See 
also  the  remarks  of  Lecky  in  his  "  History  of  England  in  the 
Eighteenth  Century,"  Vol.  HI  (1883),  p.  76:  "At  every  turn 
of  the  wheel,  at  every  change  in  the  system  or  personality  of 
the  Government  vast  sums  of  money  were  drawn  from  the 
national  treasury,"  and  so  on. 


6o  ENGLAND'S  DEBT  TO  INDIA 

condemned  both  the  inland  private  trade  carried  on 
by  their  servants  in  defiance  of  old  treaties,  and  the 
new  treaty  which  had  been  "  exacted  by  violence." 
Clive's  views  on  the  condition  of  Bengal  at  the  time, 
may  be  gathered  from  the  letters  he  wrote  to  the  di- 
rectors after  his  return  to  Bengal.  In  one  of  the 
letters  he  said: 

"  I  shall  only  say  that  such  a  scene  of  anarchy,  con- 
fusion, bribery,  corruption,  and  extortion  was  never 
seen  or  heard  of,  in  any  country  but  Bengal ;  nor  such 
and  so  many  fortunes  acquired  in  so  unjust  and  ra- 
pacious a  manner.  The  three  provinces  of  Bengal, 
Behar,  and  Orissa,  producing  a  clear  revenue  of  £3,- 
000,000  sterling,  have  been  under  the  absolute  man- 
agement of  the  Company's  servants,  ever  since  Mir 
Jaffar's  restoration  to  the  subaship;  and  they  have, 
both  civil  and  military,  exacted  and  levied  contributions 
from  every  man  of  power  and  consequence,  from  the 
Nabob  down  to  the  lowest  zemindar. 

"  The  trade  has  been  carried  on  by  free  merchants, 
acting  as  gomastas  to  the  Company's  servants,  who 
under  the  sanction  of  their  names,  have  committed  ac- 
tions which  make  the  name  of  the  English  stink  in  the 
nostrils  of  a  Hindu  or  a  Mussulman;  and  the  Com- 
pany's servants  themselves  have  interfered  with  the 
revenues  of  the  Nabab,  turned  out  and  put  in  the  offi- 
cers of  the  government  at  pleasure,  and  made  every  one 
pay  for  their  preferment."  ^^  These  views  were  re- 
peated, and  proposals  to  remedy  the  evils  were  offered 
in  another  letter,  which  is  an  epoch  making  document 
and  deserves  extensive  quotation,  in  any  discussion 

"Malcolm,  "Life  of  Clive,"  II,  p.  379. 


INDUSTRIAL  REVOLUTION  6i 

of  the  events  of  these  times.     We  give  a  few  para- 
graphs below: 

"  Upon  my  arrival,  I  am  sorry  to  say,  I  found  your 
affairs  in  a  condition  so  nearly  desperate  as  would 
have  alarmed  any  set  of  men  whose  sense  of  honour 
and  duty  to  their  employers  had  not  been  estranged 
by  the  too  eager  pursuit  of  their  own  advantage.  The 
sudden,  and,  among  many,  the  unwarrantable  acquisi- 
tion of  riches,  had  introduced  luxury  in  every  shape 
and  in  the  most  pernicious  excess.  These  two  enorm- 
ous evils  went  hand  in  hand  together  through  the  whole 
Presidency,  infecting  almost  every  member  of  each 
Department ;  every  inferior  seemed  to  have  grasped  at 
wealth  that  he  might  be  able  to  assume  that  spirit  of 
profusion  which  was  now  the  only  distinction  between 
him  and  his  superior.  ...  It  is  no  wonder  that  the 
lust  of  riches  should  readily  embrace  the  proffered 
means  of  its  gratification,  or  that  the  instruments  of 
your  power  should  avail  themselves  of  their  authority, 
and  proceed  even  to  extortion  in  those  cases  where 
simple  corruption  could  not  keep  pace  with  their  rapac- 
ity. Examples  of  this  sort,  set  by  superiors,  could 
not  fail  of  being  followed  in  proportional  degree  by 
inferiors ;  the  evil  was  contagious,  and  spread  among 
the  civil  and  military,  down  to  the  writer,  the  ensign, 
and  the  free  merchant.  .  .  .^^ 

"  The  sources  of  tyranny  and  oppression,  which 
have  been  opened  by  the  European  agents  acting  under 
the  authority  of  the  Company's  servants,  and  the  num- 
berless black  agents  and  sub-agents  acting  also  under 
them,  will,  I  fear,  be  a  lasting  reproach  to  the  English 
name  in  this  country.  ...  I  have  at  last,  however,  the 
happiness  to  see  the  completion  of  an  event,  which,  in 
this  respect  as  well  as  in  many  others,  must  be  pro- 
ductive of  advantages  hitherto  unknown,  and  at  the 

16  Quoted  by  Dutt,  "  India  Under  Early  British  Rule,"  pp.  35, 
36. 


62  ENGLAND'S  DEBT  TO  INDIA 

same  time  prevent  abuses  that  have  hitherto  had  no 
remedy :  I  mean  the  Devvanee,  which  is  the  superin- 
tendency  of  all  the  lands  and  the  collection  of  all  the 
revenues  of  the  Provinces  of  Bengal,  Behar,  and 
Orissa.  The  assistance  which  the  Great  Moghul  had 
received  from  our  arms  and  treasury  made  him  readily 
bestow  this  grant  upon  the  Company ;  and  it  is  done 
in  the  most  effectual  manner  you  can  desire.  The  al- 
lowance for  the  support  of  the  Nabob's  dignity  and 
power,  and  the  tribute  to  His  Majesty  (the  Great 
Moghul)  must  be  regularly  paid;  the  remainder  be- 
longs to  the  Company.  ,  .  . 

"  13.  Your  revenues,  by  means  of  this  acquisition, 
will,  as  near  as  I  can  judge,  not  fall  far  short  for  the 
ensuing  year  of  250  lacs  of  Sicca  Rupees,  including 
your  former  possessions  of  Burdwan,  etc.  Hereafter 
they  will  at  least  amount  to  twenty  or  thirty  lacs  more. 
Your  civil  and  military  expenses  in  time  of  peace  can 
never  exceed  sixty  lacs  of  Rupees ;  the  Nabob's  al- 
lowances are  already  reduced  to  forty-two  lacs,  and 
the  tribute  to  the  King  (The  Great  Moghul)  at 
twenty-six ;  so  that  there  will  be  remaining  a  clear 
gain  to  the  Company  of  122  lacs  of  Sicca  Ruppees, 
or  £1,650,900  sterling.  .  .  ."  " 

He  also  submitted  proposals  to  increase  the  salaries 
of  the  servants  of  the  Company  though  he  could  not 
make  up  his  mind  to  recommend  a  prohibition  of  pri- 
vate inland  trade  by  them.  In  fact,  such  was  his 
moral  code,  that  on  September  18,  1865,  while  he 
was  probably  drafting  the  letter  of  September  30, 
embodying  his  proposals  about  the  Dewanee,  he  exe- 
cuted an  indenture  creating  a  partnership  of  him- 
self and  some  of  the  other  servants  of  the  Company, 
to  carry  on  joint  inland  trade  in  salt,  betel-nut  and  to- 
bacco for  their  personal  profit,  and  so  resolved  was  he 

17  Quoted  by  Dutt,  "  India  Under  Early  British  Rule,"  p.  37. 


INDUSTRIAL  REVOLUTION  63 

to  carry  on  the  trade  even  in  defiance  of  the  order  of 
the  directors  that  a  clause  was  inserted  in  the  indenture 
whereby  he,  as  president  of  the  Bengal  Council,  guar- 
anteed the  continuance  of  this  trade  even  if  the  Court 
of  Directors  in  England  ordered  its  dissolution  and  dis- 
continuance. 

Later  on  when  Lord  Clive  was  charged  with  having 
allowed  his  private  interests  to  get  the  better  of  his 
judgment  in  encouraging  this  evil,  he  tried  to  excuse 
himself  on  the  ground  that  it  was  done  to  benefit 
friends  whom  he  had  induced  to  accompany  him  to 
Bengal  on  the  understanding  of  being  allowed  to  make 
money  by  such  trade,  yet  he  never  denied  that  his  own 
personal  share  in  the  profits  of  the  transaction  was  the 
largest.^*  The  directors,  however,  condemned  the 
practice  in  the  strongest  terms  and  reiterated  their  dis- 
approval of  the  practice  which  had  in  the  past  led  to 
the  acquisition  of  "  vast  fortunes  "  by  "  a  scene  of  the 
most  tyrannic  and  oppressive  conduct  that  was  ever 
known  in  any  age  or  country."  So  in  their  letter  of 
May  17,  1766,  they  refused  to  sanction  Clive's  scheme 
for  continuing  the  private  inland  trade  under  the  regu- 
lations framed  by  him.  The  trade,  nevertheless,  was 
continued  for  two  years  more  under  one  pretence  or 
another. 

After  Clive.  Lord  Clive  left  India  for  the  last  time 
in  1769.  In  the  words  of  Professor  Muir,  "  Clive  had 
no  sense  of  responsibility  for  the  good  government  of 
Bengal.  His  sole  desire  was  to  preserve  the  Com- 
pany's political  ascendency  by  playing  upon  the  weak- 

18  Mill,  the  historian  of  British  India,  holds  that  this  plea 
does  not  in  anyway  lessen  the  shamelessness  of  the  transac- 
tion, a  view  from  which  Wilson  differs. 


64  ENGLAND'S  DEBT  TO  INDIA 

nesses  of  the  Nabob  and  his  subjects."  ^^  In  all  his 
writings  there  is  no  hint  of  a  belief  that  the  Company 
ought  to  insure  good  government  to  the  people  of 
Bengal.  But  in  the  language  of  Brooks  Adams,  "  the 
takings  of  Clive  either  for  himself  or  for  the  Govern- 
ment were  nothing  compared  to  the  wholesale  spolia- 
tion which  followed  his  departure,  when  Bengal  was 
surrendered  a  helpless  prey  to  a  myriad  of  greedy  offi- 
cials who  '  were  irresponsible  and  rapacious  and  who 
emptied  the  private  hoards.'  " 

Speaking  of  the  gains  of  Clive,  Macaulay  says : 
"  As  to  Clive,  there  was  no  limit  to  his  acquisition  but 
his  own  moderation.  The  treasury  of  Bengal  was 
thrown  open  to  him.  There  were,  well  piled  up,  after 
the  usage  of  Indian  princes,  immense  masses  of  coin, 
among  which  might  not  seldom  be  detected  the  florins 
and  byzants  with  which  before  any  European  ship  had 
turned  the  Cape  of  Good  Hope,  the  Venetians  pur- 
chased the  stuffs  and  spices  of  the  East.  Clive  walked 
between  heaps  of  gold  and  silver,  crowned  with  rubies 
and  diamonds  and  was  at  liberty  to  help  himself." 
What  followed  his  departure  is  thus  summed  up  by 
the  same  authority: 

"  Enormous  fortunes  were  thus  rapidly  accumulated 
at  Calcutta,  while  thirty  millions  of  human  beings  were 
reduced  to  the  extremity  of  wretchedness.  The  mis- 
government  of  the  English  was  carried  to  such  a  point 
as  seems  hardly  compatible  with  the  very  existence  of 
society." 

During  the  five  years  following  Lord  Clive's  retire- 
ment from  the  service  of  the  East  India  Company  the 
servants  of  the  latter  left  nothing  undone  to  wring  out 

1"  "  The  Making  of  British  India,"  Manchester  (1915),  p.  82. 


INDUSTRIAL  REVOLUTION  65 

as  much  money  as  they  could,  by  every  means,  from 
the  rulers  and  natives  of  Bengal.  The  "  trade  oppres- 
sion "  practised  during  this  period  may  better  be  de- 
scribed in  the  words  of  William  Bolts,  a  servant  of  the 
Company,  from  his  "  Considerations  on  Indian  Af- 
fairs," published  in  1772,  a  description  v^hich  Profes- 
sor Muir  pronounces  "  substantially  true."  ^^ 
Says  Mr.  Bolts  on  page  73  of  his  book: 

"  Inconceivable  oppressions  and  hardships  have  been 
practised  towards  the  poor  manufacturers  and  work- 
men of  the  Country,  who  are,  in  fact,  monopolised  by 
the  Company  as  so  many  slaves.  .  .  .  Various  and  in- 
numerable are  the  methods  of  oppressing  the  poor 
weavers,  which  are  duly  practised  by  the  Company's 
agents  and  gomastas  in  the  country;  such  as  by  fines, 
imprisonments,  floggings,  forcing  bonds  from  them, 
etc.,  by  which  the  number  of  weavers  in  the  country 
has  been  greatly  decreased.  The  natural  consequences 
whereof  have  been,  the  scarcity,  dearness,  and  debase- 
ment of  the  manufactures  as  well  as  a  great  diminution 
of  the  revenues:  and  the  provision  of  the  Company's 
investment  has  thereby  now  become  a  monopoly,  to 
the  almost  entire  exclusion  of  all  others,  excepting  the 
servants  of  the  Company  highest  in  station,  who  hav- 
ing the  management  of  the  investment,  provide  as  much 
as  their  consciences  will  let  them  for  the  Company, 
themselves  and  their  favourites;  excepting  also  the 
foreign  Companies  who  are  permitted  to  make  some 
small  investments,  to  prevent  clamours  in  Europe.  .  .  ." 

In  this  way,  the  servants  of  the  Company  ruined  the 
trade  of  the  country,  and  by  coercion  and  oppression 
established  their  monopoly. 

Mr.  Bolts  has  dealt  with  the  situation  in  Bengal  at 
great  length  in  his  book  where  the  interested  reader 
may  pursue  his  investigations  further. 

20  Muir,  "  The  Making  of  British  India,"  p.  89. 


66  ENGLAND'S  DEBT  TO  INDIA 

This  disposes  of  the  first  two  items  of  what  C.  H. 
Peries  in  his  "  Industrial  History  of  Modern  Eng- 
land," p.  lo,  calls  "  the  plunder  of  India." 

The  third  item,  the  income  derived  from  districts  in 
possession  of  the  Company,  may  be  stated  in  the  words 
of  Mr.  Verelst,  one-time  Governor  of  Bengal : 

"  In  the  provinces  of  Burdwan  and  Midnapur,  of 
which  both  the  property  and  jurisdiction  were  ceded 
to  the  Company  by  Mir  Kasim  in  the  year  1760,  those 
evils  which  necessarily  flowed  from  the  bad  policy  of 
the  Moorish  Government  had  in  no  sort  decreased. 
On  the  contrary,  a  plan  was  adopted  in  1762  produc- 
tive of  certain  ruin  to  the  province.  The  lands  were 
let  by  public  auction  for  the  short  term  of  three  years. 
Men  without  fortune  or  character  became  bidders  at 
the  sale ;  and  while  some  of  the  former  farmers,  un- 
willing to  relinquish  their  habitations,  exceeded  per- 
haps the  real  value  in  their  offers,  those  who  had  noth- 
ing to  lose  advanced  yet  further,  wishing  at  all  events 
to  obtain  an  immediate  possession.  Thus  numberless 
harpies  were  let  loose  to  plunder,  whom  the  spoil  of  a 
miserable  people  enabled  to  complete  their  first  year's 
payment."  ^^ 

The  net  amount  remitted  to  England  by  the  repre- 
sentatives of  the  East  India  Company  on  account  of 
revenues,  after  defraying  all  the  civil  and  military 
charges  from  1765  to  1771  amounted  to  a  little  over 
four  million  pounds  sterling.  The  total  amounts  raised 
totalled  a  little  over  thirteen  million  pounds.  Most  of 
what  constituted  civil  and  military  charges  also  went  to 
England  in  one  shape  or  another. 

21 "  View  of  the  Rise  of  the  English  Government  in  Bengal," 
by  Harry  Verelst,  Esq.,  late  Governor  of  Bengal;  London, 
1772;  p.  70. 


INDUSTRIAL  REVOLUTION  67 

The  whole  matter  was  clearly  put  by  Burke  in  the  re- 
port of  the  select  committee  of  the  House  of  Com- 
mons appointed  later  to  enquire  into  the  affairs  of  the 
East  India  Company. 

"  This  new  system  of  trade,  carried  on  through  the 
medium  of  power  and  public  revenue,  very  soon  pro- 
duced its  natural  effects.  The  loudest  complaints 
arose  among  the  natives,  and  among  all  the  foreigners 
who  traded  in  Bengal.  It  must  have  unquestionably 
thrown  the  whole  mercantile  system  of  the  country 
into  the  greatest  confusion.  With  regard  to  the  na- 
tives, no  expedient  was  proposed  for  their  relief.  The 
case  was  serious  with  respect  to  European  powers. 
The  Presidency  plainly  represented  to  the  Directors 
that  some  agreement  should  be  made  with  foreign  na- 
tions for  providing  their  investment  to  a  certain 
amount,  or  that  the  deficiencies  then  subsisting  must 
terminate  in  an  open  rupture  with  France."  ^- 

"  Notwithstanding  the  famine  in  1770,  which  wasted 
Bengal  in  a  manner  dreadful  beyond  all  example,  the 
investment,  by  a  variety  of  successive  expedients,  many 
of  them  of  the  most  dangerous  nature  and  tendency, 
was  forcibly  kept  up ;  and  even  in  that  forced  and  un- 
natural state  it  gathered  strength  almost  every  year. 
The  debts  contracted  in  the  infancy  of  the  system  were 
gradually  reduced,  and  the  advances  to  contractors  and 
manufacturers  were  regularly  made ;  so  that  the  goods 
from  Bengal,  purchased  from  the  territorial  revenues, 
from  the  sale  of  European  goods,  and  from  the  pro- 
duce of  the  monopolies,  for  the  iour  years  which 
ended  with  1780,  when  the  investment  from  the  sur- 
plus revenues  finally  closed,  were  never  less  than  a 
million  sterling,  and  commonly  nearer  twelve  hundred 
thousand  pounds.  This  million  is  the  lowest  value  of 
the  goods  sent  to  Europe  for  which  no  satisfaction  is 

22  Ninth  Report,  p.  47;  Burke,  "Collected  Works,"  Vol.  Ill, 
quoted  by  Digby,  p.  28. 


68  ENGLAND'S  DEBT  TO  INDIA 

made."  ^^  [The  sale,  to  the  amount  of  one  hundred 
thousand  pounds  annually,  of  the  export  from  Great 
Britain  ought  to  be  deducted  from  this  million.] 

"  In  all  other  countries,  the  revenue,  following  the 
natural  course  and  order  of  things,  arises  out  of  their 
commerce.  Here,  by  a  mischievous  inversion  of  that 
order,  the  whole  foreign  maritime  trade,  whether  Eng- 
lish, French,  Dutch,  or  Danish,  arises  from  the  reven- 
ues ;  these  are  carried  out  of  the  country  without  pro- 
ducing anything  to  compensate  so  heavy  a  loss."  ^* 

23  Ibid.,  pp.  47-48. 
2*  I  bid.  J  p.  50. 


CHAPTER  III 

TRIBUTE  "    OR    "  DRAIN 


General  Observations.  The  question  whether  India 
pays  tribute  to  England,  or  ever  has  paid  it,  has  been 
and  is  the  subject  of  bitter  controversy  among  Enghsh 
pubHcists.  ^g^.J?^!:tl_?..?j-p''t.'7  th?^t  T"dia  has  been  pav- 
ing  an  enormous  tribute  to  England  and  still  pays  it; 
that  there  has  been  going  on  a  regular  "  drain  '* 
of  India's  wealth  to  EnglaD.d  ever  since  British  con 
nection  with  India  began ;  that  under  the  direct  ad- 

mi'ni'cfr^ti'np     r>f    Ind^     ^Y    ^"^^    Prnwr.     SITI^?     iSpS.    tha 

drain  not  only  hasnot  cea.sed  but  has  actuajlY, 
creased  ;~  and  that  thisdrain  has  impoverished  India 
beyond  description,  'l  he  other  party  holds  that  India 
has  never  paid  any  tribute  to  England ;  that  there  is  no 
drain  from  India  to  England ;  that  what  has  been  paid 
by  India  has  been  received  by  England  in  lieu  of  serv- 
ices rendered  or  capital  loaned  for  her  improvement ; 
and  that  under  British  rule  India  has  attained  a  pros- 
perity which  she  had  never  known  before  in  her  his- 
tory. We  intend  to  state  the  case  of  both  parties,  with 
as  much  fairness  as  we  are  capable  of,  considering 
that  together  with  all  Indian  publicists  we  agree  with 
the  former  and  have  no  doubt  of  India's  having  been  Y 
exploited  and  economically  injured  by  British  policy. 
'IrTflTFpfecedmg  chapler  we  have  shown  how  Eng- 

69 


70  ENGLAND'S  DEBT  TO  INDIA 

land  stood,  economically,  for  more  than  two  centuries, 
immediately  preceding  the  battle  of  Plassy  and  there- 
about; also  how  Indian  treasure  flowed  to  England 
and  changed  the  whole  economic  outlook  there.  We 
do  not  know  of  a  single  publicist  English  or  Indian 
who  denies  or  questions  the  facts  upon  w^hich  the  theory 
of  drain  is  based.  All  parties  are  agreed  that  at  least 
for  thirty  years,  from  1757  to  1787,  Bengal  was 
"  plundered  "  by  the  servants  of  the  East  India  Com- 
pany. What  happened  afterwards  will  be  stated 
partly  in  the  chapter  relating  to  industries  and  com- 
pleted in  other  chapters. 

Drain:  the  Case  Against  England.  In  a  letter  of 
July  2,  1 90 1,  published  in  the  Morning  Post,  London, 
Mr.  H.  M.  Hyndman,  the  great  Socialist  leader,  said: 

"  More  than  twenty  years  ago  the  late  Sir  Louis 
Mallet  (I  presume  with  the  knowledge  and  consent  of 
Lord  Cranbrook,  then  Secretary  of  State  for  India, 
and  of  my  friend  the  late  Edward  Stanhope,  then  Un- 
der-Secretary) put  at  my  disposal  the  confidential 
documents  in  the  India  office,  from  Indian  finance  min- 
isters and  others,  bearing  on  this  question  of  the  drain 
from  India  to  England  and  its  effects.  The  situation 
is,  to  my  mind,  so  desperate  that  I  consider  I  am  en- 
titled to  call  on  Lord  George  Hamilton  to  submit  the 
confidential  memoranda  on  this  subject,  up  to  and  after 
the  year  1880,  for  the  consideration  of  the  House  of 
Commons.  I  venture  to  assert  that  the  public  will 
be  astonished  to  read  the  names  of  those  who  (pri- 
vately) are  at  one  with  me  on  this  matter.  As  to 
remedy,  there  is  but  one,  and  it  is  almost  too  late  for 
that:  the  stanching  of  the  drain  and  the  steady  sub- 


"  TRIBUTE  "  OR  "  DRAIN  "  71 

stitution  of  native  rule,  under  light  English  supervis- 
ion, for  our  present  ruinous  system." 

On  page  208  of  his  book  Mr.  W.  Digby  gives  the 
photographic  reproduction  of  two  pages  from  an  In- 
dian Blue  Book  containing  admissions  about  the  drain. 

"  Great  Britain,  in  addition  to  the  tribute  she  makes 
India  pay  her  through  the  customs,  derives  benefit 
from  the  savings  of  the  service  at  the  three  presiden- 
cies being  spent  in  England  instead  of  in  India ;  and  in 
addition  to  these  savings,  which  probably  amount  to 
near  a  million,  she  derives  benefit  from  the  fortunes 
realised  by  the  European  mercantile  community,  which 
are  all  remitted  to  England."  Pari.  Paper,  1853  (445- 
II.),  page  580. 

The  following  extracts  are  made  from  the  "  Reports 
of  the  Committees  of  the  House  of  Commons"  (Vol. 
V,  1781-82,  printed  1804).  Comparing  Indian  rule 
with  the  rule  of  the  East  India  Company,  Mr.  Philip 
Francis,  once  a  member  of  the  Bengal  Council,  wrote : 

"  It  must  give  pain  to  an  Englishman  to  have  rea- 
son to  think  that,  since  the  accession  of  the  Company 
to  the  Dewanee,  the  condition  of  the  people  of  this 
country  has  been  worse  than  it  was  before;  and  yet 
I  am  afraid  the  fact  is  undoubted ;  and  I  believe  has 
proceeded  from  the  following  causes :  the  mode  of 
providing  the  Company's  Investment;  the  exportation 
of  specie,  instead  of  importing  large  sums  annually; 
the  strictness  that  has  been  observed  in  the  collections ; 
the  endeavours  of  all  concerned  to  gain  credit  by  an 
increase  of  revenue  during  the  time  of  their  being  in 
station,  without  sufficiently  attending  to  what  future 
consequences  might  be  expected  from  such  a  measure ; 


^2  ENGLAND'S  DEBT  TO  INDIA 

the  errors  that  subsist  in  the  manner  of  making  col- 
lections, particularly  by  the  employment  of  Aumils: 
These  appear  to  me  the  principal  causes  why  this  fine 
country,  which  flourished  under  the  most  despotic  and 
arbitrary  Government,  is  verging  towards  its  ruin 
while  the  English  have  really  so  great  a  share  in  the 
Administration." 

Ten  years  later,  says  Mr.  Digby  *'  Prosperous  Brit- 
ish India,"  p.  215.  Charles  Grant,  of  the  Indian  House, 
the  greatest  panegyrist  of  British  rule  in  India  —  and, 
at  the  same  time,  himself  the  worst  disparager  of  the 
Indian  people  known  in  British-Indian  literature  — 
was  constrained  to  admit :  "  We  apply  a  large  portion 
of  their  annual  produce  to  the  use  of  Great  Britain." 

The  Honourable  F.  J.  Shore,  a  retired  Bengal  ad- 
ministrator, says  in  his  "  Notes  on  Indian  Affairs  " 
(London,  1837,  Vol.  II,  page  516) : 

"  More  than  seventeen  years  have  elapsed  since  I 
first  landed  in  this  country ;  but  on  my  arrival,  and 
during  my  residence  of  about  a  year  in  Calcutta,  I  well 
recollect  the  quiet,  comfortable,  and  settled  conviction, 
which  in  those  days  existed  in  the  minds  of  the  English 
population,  of  the  blessings  conferred  on  the  natives 
of  India  by  the  establishment  of  the  English  rule.  .  .  . 

"  I  was  thus  gradually  led  to  an  inquiry  into  the 
principles  and  practice  of  British-Indian  administra- 
tion. Proceeding  in  this,  I  soon  found  myself  at  no 
loss  to  understand  the  feelings  of  the  people  both  to- 
wards the  Government  and  to  ourselves.  It  would 
have  been  astonishing  indeed  had  it  been  otherwise. 
The  fundamental  principle  of  the  English  had  been 
to  make  the  whole  Indian  nation  subservient,  in  every 
possible  way,  to  the  interests  and  benefits  of  them- 
selves.    They  have  been  taxed  to  the  utmost  limit; 


"  TRIBUTE  "  OR  "  DRAIN  "  73 

every  successive  Province,  as  it  has  fallen  'i^fo  <^^^y  p^'^- 
sesJTUnjnias  been  made  a  field  for  Jugher_exaction ; 
and  it  has  always  been  our  boast  how  greatly  we  have 
raised  the  revenue  above  that  which  the  native  rulers 
were  able  to  extort.  The  Indians  have  been  excluded 
from  every  honour,  dignity^  or  office'^ which  the  low- 
est  Englis%man'TouIT~Be' prevdUe'd  uJbWTo~ci:ucept'' 
[Italics  ours.]  

And  elsewhere  he  writes: 

"  The  halcyon  days  of  India  are  over ;  she  has  been 
drained  of  a  large  proportion  of  the  wealth  she  once 
possessed;  and  her  energies  have  been  cramped  by  a 
sordid  system  of  misrule  to  which  the  interests  of  mil- 
lions have  been  sacrificed  for  the  benefit  of  the  few."  ^ 

John  Sullivan,  also  an  eminent  English  administra- 
tor, who  served  in  India  from  1804  to  1841  and  was 
examined  by  the  Select  Committee  of  the  House  of 
Commons  when  the  question  of  the  renewal  of  the 
charter  of  the  East  India  Company  came  up  in  1853, 
said: 

"  Do  you  suppose  that  they  (the  people  of  India) 
have  traditions  among  them  which  tell  them  that  the 
economic  condition  of  the  population  was  better  in 
former  times  under  their  native  rulers  than  it  is  now  ? 

"I  think,  generally  speaking,  history  tehs  us  that  it_ 
was  ;*tKey~ Rave  been  in  a  state  of  the  greatest^ros- 
perity  from  the  earliest  times  as  far  as  history  tells, 
us. -..- 

"  How  do  you  account  for  the  superior  economic 
state  of  the  people,  and  for  their  ability  to  lay  out  the 
money  which  they  did  in  canals  and  irrigation  and 
tanks,  if  they  were  wasting  more  wealth,  and  sacrificing 
more  lives  in  war,  than  we  do  now,  especially  seeing 
that  the  wars  were  carried  on  very  much  upon  their 

1  Ibid.,  p.  28. 


74  ENGLAND'S  DEBT  TO  INDIA 

own  territories,  instead  of  being  beyond  their  limits? 
"  We  have  an  expensive  element  which  they  were 
free  from,  which  is  the  European  element,  civil  and 
military,  which  swallows  up  so  much  of  the  revenue ; 
from  that  cause  our  administration  is  so  much  more 
expensive ;  that,  I  think,  is  the  great  reason." 

John  Sullivan  did  not  shrink  from  the  logical  con- 
clusion of  his  opinions,  when  he  was  asked  if  he  would 
restore  British  territory  to  native  rule,  keeping  the 
military  control  of  the  Empire  in  British  hands. 

"  4890.  You  would  restore  a  great  deal  of  territory 
to  native  rulers  upon  principles  of  justice?" 

"  Yes." 

"  Because  we  have  become  possessed  of  them  by 
violence  or  by  other  means  without  any  just  right  or 
title?" 

"  I  would  do  so  upon  principles  of  justice  and  upon 
principles  of  financial  economy."  ^ 

He  also  said : 

"  As  to  the  complaints  which  the  people  of  India 
have  to  make  of  the  present  fiscal  system,  I  do  not 
conceive  that  it  is  the  amount  altogether  that  they 
have  to  complain  of.  I  think  they  have  rather  to 
complain  of  the  application  of  that  amount.  Under 
their  own  dynasties,  all  the  revenue  that  was  collected 
in  the  country  was  spent  in  the  country ;  but  under 
our  rule,  a  large  proportion  of  the  revenue  is  annually 
drained  away,  and  without  any  return  being  made 
for  it ;  this  drain  has  been  going  on  now  for  sixty  or 
seventy  years,  and  it  is  rather  increasing  than  the 
reverse.  .  .  .  Our    system    acts    very    much    like    a 

2  Third  Report  of  the  Select  Committee,  1853,  pp.  19  and  20. 


"  TRIBUTE  "  OR  "  DRAIN  "  75 

sponge,  drawing  up  all  the  good  things  from  the  banks 
of  the  Ganges,  and  squeezing  them  down  on  the  banks 
of  the  Thames.  .  .  ."   [Italics  ours.] 

Sir  John  Malcolm,  Governor  of  Bombay  in  1827 
(one  of  the  makers  of  British  Empire  in  India)  was 
examined  before  the  select  committee  of  the  House  of 
Commons  in  1832. 

"  In  your  opinion,  was  the  substitution  of  our  gov- 
ernment for  the  misrule  of  the  native  princes  the 
cause  of  greater  prosperity  of  the  agricultural  and 
commercial  part  of  the  population? 

"  I  cannot  answer  this  in  every  province  of  India, 
but  I  shall  as  far  as  my  experience  enables  me.  I  do 
not  think  the  change  has  benefited,  or  could  benefit 
either  the  commercial,  the  monied,  or  the  agricultural 
classes  of  many  of  the  native  States,  though  it  may  be 
of  others.  It  has  not  happened  to  me  ever  to  see 
countries  better  cultivated,  and  so  abounding  in  all 
produce  of  the  soil,  as  well  as  commercial  wealth,  than 
the  southern  Mahratta  districts,  when  I  accompanied 
the  present  Duke  of  Wellington  to  that  country  in 
the  year  1803.  .  .  . 

"  With  respect  to  Malwa.  .  .  .  And  I  do  not  believe 
that  the  introduction  of  our  direct  rule  could  have  con- 
tributed more,  nor  indeed  so  much,  to  the  prosperity 
of  the  commercial  and  agricultural  interests  as  the 
establishment  of  the  efficient  rule  of  its  former  princes 
and  chiefs.  .  .  . 

"  With  respect  to  the  southern  Mahratta  districts, 
of  whose  prosperity  I  have  before  spoken  ...  I  must 
unhesitatingly  state  that  the  provinces  belonging  to  the 
family  of  Putwarden  and  some  other  chiefs  on  the 


76  ENGLAND'S  DEBT  TO  INDIA 

banks  of  the  Krishna  present  a  greater  agricultural 
and  commercial  prosperity  than  almost  any  I  know  in 
India.  .  .  .  Above  all  causes  which  promote  prosperity 
is  the  invariable  support  given  to  the  village  and  other 
native  institutions,  and  to  the  employment,  far  be- 
yond what  our  system  admits,  of  all  classes  of  the 
population."  ^ 

Sir  George  Wingate,  who  had  held  high  posts  in  the 
government  of  Bombay,  recorded  the  following  ob- 
servations for  the  consideration  of  his  countrymen 
when  the  administration  of  the  Empire  passed  to  the 
Crown  in  1858: 

"  If,  then,  we  have  governed  India  not  merely  for 
the  natives  of  India  but  for  ourselves,  we  are  clearly 
blamable  in  the  sight  of  God  and  man  for  having  con- 
tributed nothing  towards  defraying  the  cost  of  that 
government.  .  .  . 

"  With  reference  to  its  economic  effects  upon  the 
condition  of  India,  the  tribute  paid  to  Great  Britain 
is  by  far  the  most  objectionable  feature  in  our  exist- 
ing policy.  Taxes  spent  in  the  country  from  which 
they  are  raised  are  totally  different  in  their  effects 
from  taxes  raised  in  one  country  and  spent  in  an- 
other. .  .  . 

"  The  Indian  tribute,  whether  weighed  in  the  scales 
of  justice  or  viewed  in  the  light  of  our  true  interest, 
will  be  found  to  be  at  variance  with  humanity,  with 
common  sense,  and  with  the  received  maxims  of  eco- 
nomical science."    Again, 

"  Were  India  to  be  relieved  of  this  cruel  burden  of 

3  "  Minutes  of  Evidence  taken  before  the  Select  Committee, 
&c.,  1832,"  Vol.  VI,  pp.  30  and  31. 


"  TRIBUTE  "  OR  "  DRAIN  "  ^^ 

tribute  and  the  whole  of  the  taxes  raised  in  India  to 
be  spent  in  India,  the  revenue  of  that  country  would 
soon  acquire  a  degree  of  elasticity  of  which  we  have 
at  present  no  expectation."  "  Our  Financial  Relations 
with  India,"  by  Major  Wingate,  London,  1859,  pp. 
56-64,  quoted  by  Dutt  "  Early  British  Rule,"  pp.  618- 
20.     [ItaHcs  ours.] 

On  page  126  of  his  book  "  India  in  the  Victorian 
Age,"  Dutt  quotes  the  opinion  of  Colonel  Sykes,  a 
distinguished  director  of  the  East  India  Company,  who 
"  spoke  of  the  economic  drain  from  India  of  £3,300,- 
000  to  £3,700,000  a  year  "  and  remarked  that  "  It  is 
only  by  the  excess  of  exports  over  imports  that  India 
can  bear  this  tribute." 

Henry  St.  John  Tucker,  the  chairman  of  the  East 
India  Company,  (quoted  by  Dutt),  said  that  this  eco- 
nomic drain  was  an  increasing  quantity,  "  because  our 
home  charge  is  perpetually  increasing,"  a  prophecy 
which  has  been  more  than  amply  fulfilled. 

Similarly  another  East  Indian  merchant  quoted  in 
the  Parliamentary  report  of  1853,  said :  "  I  may  say 
generally  that  up  to  1847,  the  imports  (of  India)  were 
about  £6,000,000  and  the  exports  about  £9,500,000. 
The  difference  is  the  tribute  which  the  company  re- 
ceived from  the  country,  which  amounts  to  about 
£4,000,000."  * 

Mr.  Montgomery  Martin,  a  historian  of  the  British 
colonies  and  dependencies,  wrote  in  1838: 

"  So  constant  and  accumulating  a  drain,  even  on 
England,  would  soon  impoverish  her;  how  severe, 
then,  must  be  the  effect  on  India,  where  the  wages  of 

*  First  Report,  1853. 


78  ENGLAND'S  DEBT  TO  INDIA 

a  labourer  is  from  two  pence  to  three  pence  a  day."  ^ 

Prof.  H.  H.  Wilson,  historian  of  India,  says  of  the 
annual  drain  of  wealth : 

"  Its  transference  to  England  is  an  abstraction  of 
Indian  capital  for  which  no  equivalent  is  given ;  it  is 
an  exhausting  drain  upon  the  country,  the  issue  of 
which  is  replaced  by  no  reflux ;  it  is  an  extraction  of 
the  life-blood  from  the  veins  of  national  industry 
which  no  subsequent  introduction  of  nourishment  is 
furnished  to  restore." 

Mr.  A.  J.  Wilson,  in  an  article  in  the  Fortnightly 
Reviezv,  of  March,  1884,  wrote: 

"  In  one  form  or  another  we  draw  fully  £30,000,000 
a  year  from  that  unhappy  country  (India),  and  there 
the  average  wages  of  the  natives  is  about  £5  per  an- 
num, less  rather  than  more  in  many  parts.  Our  In- 
dian tribute,  therefore,  represents  the  entire  earnings 
of  upwards  of  six  millions  heads  of  families  —  say 
of  30,000,000  of  the  people.  It  means  the  abstraction 
of  more  than  one  tenth  of  the  entire  sustenance  of 
India  every  year." 

Lord  Salisbury,  the  great  English  statesman,  spoke 
in  1875  of  India  as  a  country  from  which  "  much 
of  the  revenue "  was  "  exported  without  a  direct 
equivalent." 

Dr.  J.  T,  Sunderland,  a  Unitarian  minister  of  the 
United  States,  in  his  pamphlet  "  The  Causes  of  Fam- 
ine in  India"  (page  22),  refers  to  the  heavy  drain  of 
wealth  that  is  going  on  as  "  the  greatest  of  all  the 
causes  of  the  impoverishment  of  the  Indian  people." 

s  "  History,  etc.,  of  Eastern  India,"  Vol.  II,  p.  12.  See  also 
Dutt,  "  Early  British  Rule,"  p.  609. 


"  TRIBUTE  "  OR  "  DRAIN  "  79 

This  synopsis  of  opinions  about  the  "  tribute " 
which  India  pays  and  has  been  paying  for  more  than 
a  century  and  a  half  to  England,  or  about  the  "  drain  " 
of  India's  wealth  to  England,  is  by  no  means  ex- 
haustive. In  fact  one  could  fill  a  volume  with  such 
extracts.  Besides  we  have  scrupulously  kept  back  the 
opinions  of  those  British  statesmen  (several  of  them 
very  eminent  Anglo-Indian  administrators  like  Sir 
Henry  Cotton  —  late  Chief  Commissioner  of  Assam, 
and  once  an  M.  P. ;  Sir  William  Wedderburn,  retired 
member  of  the  Bombay  Council  and  once  an  M.  P. ; 
Mr.  W.  S.  Caine,  late  M.  P. ;  Mr.  A.  O.  Hume,  once 
a  secretary  to  the  Government  of  India ;  and  many 
others),  who  have  openly  and  actively  identified  them- 
selves in  one  way  or  another,  with  the  cause  of  Indian 
nationalism.  Similarly  we  have  made  no  mention  of 
the  opinions  of  Indians  themselves.  Some  further 
opinions  we  hope  to  cite  when  we  come  to  discuss 
the  extent  of  the  drain. 

Drain:  the  Case  for  England.  Now  we  give  below 
a  summary  of  the  opinions  on  the  other  side.  It 
should  be  noted,  however,  that  this  school  which  holds 
that  India  pays  no  tribute  to  England  and  that  there 
is  no  drain  of  India's  wealth  to  England  is  of  compara- 
tively recent  growth.  So  long  as  the  administration  of 
India  was  vested  in  the  East  India  Company,  the  pres- 
ence of  this  tribute  and  the  existence  of  this  drain  was 
admitted.  It  was  hardly  ever  questioned.  In  fact 
that  was  the  test  by  which  James  Mill  judged  the 
benefit  to  England  of  her  occupation  of  India.  It  is 
more  or  less  within  the  last  thirty  years  that  the  fact  of 
this  drain  has  begun  to  be  denied.     We  give  below  the 


8o  ENGLAND'S  DEBT  TO  INDIA 

explanation  of  the  so-called  drain,  that  is  embodied 
in  the  new  edition  of  the  Imperial  Gaaeteer  of  India 
(an  official  publication),  Vol.  IV. 

Discussing  the  "Home  Charges"  (which  properly 
speaking  should  be  called  "  Foreign  Charges  "  met  by 
Indian  revenues),  the  compiler  of  the  chapter  says: 

"  These  Home  Charges  have  sometimes  been  er- 
roneously described  as  a  tribute  which  India  pays  to 
England  in  consequence  of  her  subordination  to  that 
Country  .  .  .  figures  will  show  that  nearly  ii  out  of 
iy)4  million  pounds  consist  of  payments  on  account  of 
Capital  and  materials  supplied  by  England  and  belong 
to  a  Commercial  rather  than  an  administrative  class  of 
transaction.  Of  the  balance  43/2  millions  represent 
furlough  and  pension  payments  and  are  a  necessary 
concomitant  of  the  British  Administration,  to  which 
India  owes  her  prosperity."  ^     [Italics  ours.] 

We  also  make  the  following  long  quotation  from  a 
leaflet  called  "  The  Truth  About  '  The  Drain,' "  pub- 
lished and  distributed  free  by  the  East  India  Associa- 
tion of  London  (April,  1909)  : 

"  What  are  the  facts  about  the  drain  of  India's 
wealth  into  Great  Britain?  It  has  been  assumed  that 
there  is  a  drain,  but  the  nature  and  extent  of  this 
drain  has  been  highly  exaggerated,  and  sometimes 
grossly  misrepresented.  The  official  *  drain '  is  in- 
cluded in  what  are  known  as  the  '  home  charges,*  and 
these  *  Home  charges '  for  the  three  years  from  1904 
to  1907  amount  on  the  average  to  £19,000,000  a  year, 
reduced  to  about  ii8,ooo,ooo  by  deducting  sundry  re- 
ceipts. These  i  18,000,000  can  be  roughly  summarised 
and  grouped  under  the  following  heads : 

^"Imperial  Gazctccr  of  India,"  Oxford,  1907,  Vol.  IV,  p. 
194. 


"  TRIBUTE  "  OR  "  DRAIN  "  8l 

(i)  Interest  on  money  due  or  bor- 
rowed (chiefly  for  railways,  etc.) 
about   . .; £10,000,000 

(2)  Purchase  of  stores £2,500,000 

(3)  MiHtary  charges  (including  pen- 
sions)        £4,000,000 

(4)  Civil  charges  (including  pensions)  £2,500,000 

"  As  will  be  seen  (4)  civil  and  (3)  miUtary  charges, 

including  pensions,  amount  to  £6,500,000.     This  is  no 

doubt  a  heavy  charge,  but  it  might  well  be  regarded 

as  a  not  unreasonable  premium  payable  for  insurance  ■fi/f'^' 

against  foreign  aggression  and   internal   disturbance^^^x^ 

The  peace  and  security  enjoyed  in  India  may  be  taken 

as  an  adequate  return  for  this  outlay. 

"  It  is  not  intended  to  justify  every  charge  in  the 
debt  account,  but  (i)  payment  of  interest  on  sums 
borrowed  for  the  construction  of  railways,  etc.,  or  (2) 
disbursements  on  account  of  the  purchase  of  stores, 
cannot  fairly  be  described  as  a  '  drain,'  because  in  re- 
turn for  this  money  India  has  received  adequate  com- 
mercial equivalent  in  the  shape  of  metals,  machinery, 
railway  plant,  and  miscellaneous  stores.  Such  receipts 
have  always  been  justly  regarded  as  amongst  the  most 
valuable  and  permanent  of  commercial  returns. 

"  It  has,  however,  been  urged  that,  in  addition  to 
these  known  payments,  there  is  an  unknown  drain  on 
India's  resources  in  the  shape  of  private  remittances, 
and  the  extent  of  this  drain  has  been  estimated  at  be- 
tween £10,000,000  and  £12,000,000  a  year.  This  is,  of 
course,  a  mere  guess,  and  the  probabilities  are  against 
the  accuracy  of  this  guess.  The  sum  mentioned  is 
more  than  double  the  annual  pay  of  all  the  European 
officials  in  India,  civil  and  military,  and  it  seems  idle  to 
contend  that  the  comparatively  few  European  mer- 
chants in  India  earn  more  than  all  the  civil  and  military 
European  officials  put  together.  It  is  well  known  that 
European  officials  in  India  cannot  remit  a  moiety  of 
their  pay  to  England.     Many  of  them  spend  their  pay 


82  ENGLAND'S  DEBT  TO  INDIA 

(and  even  more)  in  India.     It  must  surely  be  the  same 
with  some  European  merchants." 

We  give  yet  another  quotation  from  a  writer  who 
may  aptly  be  called  the  father  of  this  school  of  Anglo- 
Indian  economists.  Sir  John  Strachey,  who  was  Fi- 
nance Minister  of  India  in  the  administration  of  Lord 
Lytton,  observes  in  his  book,  "  India,  Its  Administra- 
tion and  Progress  " : 

"  During  the  last  ten  years  the  average  value  of  the 
imports  into  India  fell  short  of  the  value  of  the  exports 
by  about  i  16,000,000  a  year.  In  this  calculation  are 
included  imports  and  exports  both  of  merchandise  and 
treasure,  on  Government  as  well  as  on  private  account. 
For  the  excess  India  receives  no  direct  commercial 
equivalent,  but  she  receives  the  equivalent  in  another 
form. 

"  English  capital  to  a  very  large  amount  has  been, 
and  is  still  being,  invested  in  India  by  the  State  and  by 
private  individuals  in  railways,  irrigation  works,  and 
industrial  enterprises,  and  interest  on  these  invest- 
ments has  to  be  remitted  to  England.  In  addition  to 
this,  large  sums  are  required  in  England  for  what  are 
really  investments  for  India  of  another  kind.  It  is  an 
inevitable  consequence  of  the  subjection  of  India  that 
a  portion  of  the  cost  of  her  government  should  be  paid 
in  England.  The  maintenance  of  our  dominion  is 
essential  in  the  interests  of  India  herself,  and,  pro- 
vided that  she  is  not  compelled  to  pay  more  than  is 
really  necessary  to  give  her  a  thoroughly  efficient  Gov- 
ernment, and  in  return  for  services  actually  rendered 
to  her,  she  has  no  reason  for  complaint.  The  charges 
to  be  met  in  England  are  numerous :  interest  has  to  be 
paid  on  sterling  debt  incurred  for  India  in  England; 
there  are,  among  others,  charges  for  civil  and  military 
administration,  interest  and  annuities  on  account  of 
state  railways,  and  interest  on  the  ordinary  public  debt, 


"  TRIBUTE  "  OR  "  DRAIN  "  83 

furlough  allowances,  pensions,  payments  to  the  Gov- 
ernment in  England  for  British  troops  employed  in 
India,  stores  of  every  kind,  railway  material  for  use 
in  India,  and  the  Secretary  of  State's  administration  at 
the  India  Office.  The  ordinary  annual  charge  under 
the  last-named  head  is  about  £200,000.  The  charges 
to  be  met  in  England  necessarily  vary  from  year  to 
year;  in  1909-10  they  amounted  to  about  £18,500,000.'^ 

A  pupil  of  Sir  John  Strachey,  Sir  Theodore  Mori- 
son,  a  member  of  the  India  Council,  discusses  the 
question  at  some  length  in  his  book  called  "  The  Eco- 
nomic Transition  in  India  "  and  concludes  thus : 

"  When  viewed  in  this  way  I  do  not  believe  it  is  pos- 
sible to  resist  the  conclusion  that  India  derives  a  pecuni- 
ary advantage  from  her  connection  with  the  British 
Empire  [ ! ! !]  The  answer,  then,  which  I  give  to  the 
question  *  What  economic  equivalent  does  India  get 
for  foreign  payments  '  is  this : —  India  gets  the  equip- 
ment of  modern  industry,  and  she  gets  an  administra- 
tion favourable  to  economic  evolution  cheaper  than 
she  could  provide  herself."  ® 

We  have  italicised  the  word  "  cheaper  " :  the  argu- 
ments and  figures  we  will  notice  later  on. 

Drain:  Weighing  the  Evidence.    The  reader  is  now 

''igii  Edition  revised  by  Sir  Thomas  W.  Holderness,  K.  C. 
S.  I.,  Permanent  Under  Secretary  of  State  for  India. 

8  In  this  connection  it  will  be  of  interest  to  compare  the  re- 
marks of  Sir  John  Strachey  and  Sir  Theodore  Morison  with 
the  following  observations  of  Mr.  Richard  Jebb  in  his  "  Stud- 
ies in  Colonial  Nationalism"  (London,  1905),  p.  322:  "If  it 
be  objected  that  orderly  Government  is  sufficient  compensa- 
tion to  India  for  commercial  exploitation,  the  ready  reply  is 
forthcoming  that  the  administration  is  paid  for  separately  in 
hard  Indian  cash ;  and  so  far  from  being  a  philanthropic  serv- 
ice provides  congenial  and  remunerative  employment  for  a 
large  number  of  Englishmen  who  could  not  have  found  the 
same  opportunity  elsewhere." 


84  ENGLAND'S  DEBT  TO  INDIA 

in  possession  of  the  views  of  both  sides  on  the  ques- 
tion of  "tribute"  or  "drain."  In  forming  his  judg- 
ment he  should  consider  that  according  to  all  sound 
systems  of  weighing  evidence  admissions  by  a  party 
in  his  own  favour  are  of  little  value.  The  question  in 
essence  is,  whether  Great  Britain  gets  anything  from 
India  by  virtue  of  her  political  domination  of  it  and 
if  so,  what?  One  set  of  Britishers  says  she  gets  enor- 
mous sums  for  which  India  gets  no  "  direct  equiva- 
lent." This  they  call  India's  tribute  or  drain.  An- 
other set  says  she  gets  nothing  as  tribute,  that  what 
she  gets  is  in  lieu  of  "  services  "  she  renders.  That 
she  gets  large  sums  is  thus  undisputed. 

The  only  question  that  remains  to  be  considered  is 
the  value  of  the  services  rendered.  Every  superior  po- 
litical authority,  which  exacts  a  tribute  from  an  in- 
ferior, can  justify  the  tribute  on  the  same  grounds 
on  which  the  British  do.  So  this  quarrel  seems  to  be 
nothing  but  a  play  on  words.  We  do  not  intend,  how- 
ever, to  leave  the  subject  here  and  shall  examine  it 
more  closely  on  the  lines  laid  down  by  Messrs. 
Strachey  and  Morison. 

In  order  to  be  absolutely  clear  on  the  point  it  is 
necessary  to  know  (i)  of  what  the  drain  consists, 
(2)  the  extent  of  that  drain  from  1757,  when  the 
political  connection  commenced,  up  to  the  pres- 
ent. 

Speaking  in  general  terms,  whatever  India  has  paid 
and  still  pays  to  England  in  money  or  in  goods,  with- 
out receiving  an  equivalent  in  money  or  in  goods  is 
the  "  drain."     That  is  practically  what  Lord  Salisbury 


"  TRIBUTE  "  OR  "  DRAIN  "  85 

said.  This  includes  (i)  the  treasure  which  the  East 
India  Company  and  their  servants  accumulated  from 
India  in  the  early  years  of  their  reign  from  1757  up 
to  1849,  the  year  of  the  annexation  of  the  Punjab,  or 
for  very  nearly  a  century. 

I  do  not  know  if  what  is  known  as  the  "  loot "  of 
India  from  1757  to  1772  and  then  afterwards  up  to 
1815  is  denied  by  the  school  of  politicians  to  which 
Sir  John  Strachey  and  Sir  Theodore  Morison  belong. 
The  period  stands  by  itself.  The  extent  of  the  treas- 
ure removed  to  England  during  this  period  is  not  to 
be  estimated  by  the  excess  of  exports  over  imports. 
This  treasure  consisted  of  gold,  silver,  precious  stones 
and  merchandise. 

The  period  of  1772  to  1785  is  represented  by  the 
administration  of  Warren  Hastings.  During  this  pe- 
riod very  large  amounts  of  money  and  very  large 
quantities  of  merchandise  were  obtained  from  the 
princes  and  people  of  India,  for  which  the  only  return 
made  was  in  the  shape  of  "  services  rendered."  These 
"  services "  resulted  in  wars  in  the  then  Northwest 
Province,  Oudh  and  Deccan.  These  exactions  were  of 
two  kinds,  (i )  those  made  in  the  name  of  the  company, 
(2)  those  made  by  the  servants  of  the  company  and 
of  which  from  the  very  nature  of  things  there  is  not 
and  could  not  be  a  record  anywhere.  Then  again  dur- 
ing the  administration  of  Wellesley  large  sums  of 
money  were  obtained  from  the  princes  of  India,  dur- 
ing the  war  carried  on  by  that  pro-consul.  This  state 
of  things  continued  more  or  less  actively  right  up  to 
the  end  of  Dalhousie's  administration.     There  is  no 


86  ENGLAND'S  DEBT  TO  INDIA 

record  extant  of  the  diamonds,  rubies  and  other  pre- 
cious stones,  worth  miUions,  which  were  removed 
from  India  during  this  time.  The  Koh-i-noor,  of  al- 
most fabulous  value,  which  was  last  in  the  possession 
of  Ranjit  Singh,  the  ruler  of  independent  Punjab,  was 
only  one  of  these.  The  system  of  international  trade 
had  not  developed  then  and  ways  were  open  for  the 
transference  of  wealth  from  one  country  to  another 
otherwise  than  by  means  of  trade.  In  fact  it  cannot 
be  disputed  that  throughout  India's  connection  with 
England  quantities  of  Indian  treasure  were  transferred 
to  England,  which  are  not  shown  in  any  account.  In 
the  days  of  the  East  India  Company,  this  treasure 
consisted  of  "  loot "  during  wars  and  of  presents  by 
princes  and  nobility  either  voluntary  or  under  com- 
pulsion.^  Since  the  assumption  of  the  administration 
by  the  Crown  this  has  consisted  of  presents  given  by, 
or  obtained  from,  the  native  princes  and  nobility  in 
the  shape  of  jewels  or  valuable  goods.  That  these 
presents  are  given  and  received  is  a  matter  of  public 
knowledge  in  India  and  cannot  be  altogether  unknown 
to  the  Anglo-Indian  brotherhood  of  the  East  India 
Association.  What  the  total  value  of  these  presents 
is,  there  is  no  means  of  ascertaining.  But  in  no  case 
can  it  be  a  trifling  amount,  and  if  we  were  to  add  com- 
pound interest,  the  amount  would  swell  to  a  very  large 
figure.  One  finds  references  to  these  presents  scat- 
tered in  histories,  accounts  of  travellers,  private  let- 
ters published,  and  in  other  documents  in  the  British 
Museum.     That  the  recipients  of  these  presents  must 

»  Observes  Mr.  J.  S.  Cotton  in  "  Colonies  and  Dependencies," 
Macmillan  &  Co.,  1883 :  "  The  first  generation  of  English 
rulers  helped  to  drain  the  country  of  its  inherited  riches." 


"  TRIBUTE  "  OR  "  DRAIN  "  87 

have  rendered  "  services  "  to  the  givers  thereof,  there 
can  be  no  doubt.  But  that  India  has  been  drained  to 
that  extent  remains  an  indisputable  fact.  Then  it 
must  be  borne  in  mind  that  throughout  the  British 
domination  of  India  a  large  portion  of  that  part  of  the 
revenue  of  India  which  was  spent  in  India  has  gone 
into  the  pockets  of  Europeans  employed  in  the  civil 
and  military  departments  of  the  company,  and  after 
them,  of  the  Crown.  For  a  long  time  the  natives  were 
employed  only  in  the  very  lowest  possible  offices,  as 
menials  or  clerks  or  sepoys.  There  were  very  few,  if 
any,  natives,  in  the  subordinate  ranks  of  civil  and 
military  offices  during  the  first  80  years  of  the  East 
India  Company's  rule.  Even  now  a  large  portion  of~ 
Indian  revenues  spent  in  India  falls  under  that  head. 
But  in  the  days  of  the  East  India  Company,  especially 
from  1757  to  1833,  when  the  services  were  at  least  in 
theory  thrown  open  to  educated  natives  the  major  por- 
tions of  civil  and  military  expenses  went  into  the 
pockets  of  Europeans  and  with  the  exception  of  the 
sums  spent  in  India  were  transferred  to  England. 

It  is  clear  that  the  amount  of  the  treasure  trans- 
ferred from  India  to  England  during  the  century  from 
1757  to  1857  or  to  the  present  is  not  correctly  repre- 
sented by  the  excess  of  exports  over  imports ;  for  to 
this  excess  should  be  added  the  amount  of  public  debt 
that  the  East  India  Company  contracted  during  this 
period. 

The  beauty  of  the  English  conquest  of  India  lies  in 
the  fact  that  from  the  first  to  the  last  not  one  single 
penny  was 'spent  By  tFe  British  on  the  conguest In- 
dia was  conquered  by  the  British^  with.  Indian. jnoney 


X 


88  ENGLAND'S  DEBT  TO  INDIA 

and_Jndiaa-We©d.  Further,  almost  all  kinds  of  ex- 
penses incurred  by  the  British  in  Asia,  for  the  con- 
quest of  territories,  for  the  expansion  of  trade,  for 
research  and  inquiry,  were  borne  by  the  Indian  ex- 
chequer. The  profits  almost  always  went  into  the 
pockets  of  Britishers.  The  expenses  and  losses  were 
debited  to  India. 

R.  C.  Dutt  points  out  how  the  total  revenues  of  In- 
dia have  always  been  in  excess  of  total  expenditures 
incurred  in  India. 

"  The  whole  of  the  public  debt  of  India,  built  up  in 
a  century  of  the  company's  rule,  was  created  by  deb- 
iting India  with  the  expenses  incurred  in  England." 

The  total  Indian  debt,  bearing  interest,  was  a  little 
over  seven  millions  in  1792.  It  had  risen  to  ten  mil- 
lions in  1799.  Then  came  Lord  Wellesley's  wars  and 
the  Indian  debt  rose  to  twenty-one  millions  in  1805. 
In  1807  it  was  twenty-seven  millions.  By  1829  it  had 
risen  to  thirty  millions.  The  total  debt  of  India  (reg- 
istered debt  +  treasury  notes  and  deposits  +  home 
bond  debt)  on  April  30,  1836,  was  ^33.355.536."  By 
1844-45  the  total  debt  of  India  had  reached  the  figure 
of  forty-three  and  one-half  million  pounds.  This  in- 
/^cluded  the  enormous  expense  of  the  Afghan  war  to 
which  England  contributed  only  a  small  part  of  the 
fifteen  millions  expended,  although  in  the  words  of 
John  Bright,  the  whole  of  this  expenditure  "  ought  to 
have  been  thrown  on  the  taxation  of  the  people  of 
England,  because  it  was  a  war  commanded  by  the  Eng- 
lish cabinet,  for  objects  supposed  to  be  English." 

10  R.  C.  Dutt,  "  India  in  the  Victorian  Age,"  pp.  215-6  and 
footnote. 


"  TRIBUTE  "  OR  "  DRAIN  "  89 

The  annexation  of  Sindh,  and  the  Punjab  wars  un- 
dertaken by  Hardinge  and  Dalhousie,  raised  the  debt 
to  fifty-five  million  pounds  by  1850-51.  Then  came 
the  great  mutiny  in  1857  and  the  public  debt  was  in- 
creased by  ten  millions  sterling.  On  April  30,  1858, 
the  public  debt  of  India  stood  at  sixty-nine  and  one- 
half  million  pounds  sterling. 

About  the  expenses  incurred  in  putting  down  the 
mutiny,  it  is  interesting  to  note  the  following  opinions 
of  Englishmen. 

"  If  ever  there  was  a  case  of  justifiable  rebellion  in 
the  world,"  says  an  impartial  historian,^^  "  it  was  the 
rebellion  of  Hindu  and  Mussulman  soldiers  in  India 
against  the  abomination  of  cartridges  greased  with  the 
fat  of  the  cow  and  the  pig.  The  blunder  was  made  by 
British  Administrators,  but  India  paid  the  cost.  Be- 
fore this,  the  Indian  Army  had  been  employed  in  China 
and  in  Afghanistan ;  and  the  East  India  Company  had 
received  no  payments  for  the  service  of  Indian  troops 
outside  the  frontiers  of  their  dominions.  But  when 
British  troops  were  sent  to  India  to  suppress  the 
mutiny,  England  exacted  the  cost  with  almost  unex- 
ampled rigour." 

"  The  entire  cost  of  the  Colonial  Office,  or,  in  other 
words,  of  the  Home  Government  of  all  British  colonies 
and  dependencies  except  India,  as  well  as  of  their  mili- 
tary and  naval  expense,  is  defrayed  from  the  revenues 
of  the  United  Kingdom ;  and  it  seems  to  be  a  natural  in- 
ference that  similar  charges  should  be  borne  by  this 
country  in  the  case  of  India.  But  what  is  the  fact? 
Not  a  shilling  from  the  revenues  of  Britain  has  ever 
been  expended  on  the  military  defence  of  our  Indian 
Empire. 

"  How  strange  that  a  nation,  ordinarily  liberal  to 
extravagance  in  aiding  colonial  dependencies  and  for- 

"Lecky's  "  Map  of  Life,"  quoted  by  R.  C.  Dutt. 


90  ENGLAND'S  DEBT  TO  INDIA 

eign  states  with  money  in  their  time  of  need,  should, 
with  unwonted  and  incomprehensible  penuriousness, 
refuse  to  help  its  own  great  Indian  Empire  in  its  ex- 
tremity of  financial  distress. 

'■'  The  worst,  however,  is  not  yet  told ;  for  it  would 
appear  that  when  extra  regiments  are  despatched  to 
India,  as  happened  during  the  late  disturbances  there, 
the  pay  of  such  troops  for  six  months  previous  to  sail- 
ing is  charged  against  the  Indian  Revenues  and  recov- 
ered as  a  debt  due  by  the  Government  of  India  to  the 
British  army  pay-office. 

"  In  the  crisis  of  the  Indian  mutiny,  then,  and  with 
the  Indian  finances  reduced  to  an  almost  desperate  con- 
dition. Great  Britain  has  not  only  required  India  to 
pay  for  the  whole  of  the  extra  regiments  sent  to  that 
country  from  the  date  of  their  leaving  these  shores, 
but  has  demanded  back  the  money  disbursed  on  ac- 
count of  these  regiments  for  the  last  six  months'  ser- 
vice in  this  country  previous  to  sailing  for  India."  ^^ 

But  a  far  greater  man  than  Sir  George  Wingate 
spoke  on  the  subject  of  the  mutiny  expenditure  in  his 
own  frank  and  fearless  manner. 

"  I  think,"  said  John  Bright,  "  that  the  forty  millions 
which  the  revolt  will  cost,  is  a  grievous  burden  to 
place  upon  the  people  of  India.  It  has  come  from  the 
mismanagement  of  the  Parliament  and  the  people  of 
England.  If  every  man  had  what  was  just,  no  doubt 
that  forty  millions  would  have  to  be  paid  out  of  the 
taxes  levied  upon  the  people  of  this  country."  ^^ 
r^  Surely  very  little  of  this  debt,  if  any,  represented 
I.British  investments  in  public  works,  as  there  were  no 

12  "Our  Financial  Relation  with  India,"  by  Major  Wingate, 
London,  1859. 

13  John  Bright's  speech  on  East  India  Loan,  March,  1859. 


"  TRIBUTE  "  OR  "  DRAIN  "  91 

railways  in  India  before  1850.  When  the  Empire  was 
transferred  to  the  Crown  it  was  provided  that  the  divi- 
dend on  the  capital  stock  of  the  East  India  Company 
and  other  debts  of  the  company  in  Great  Britain  and 
all  the  territorial  and  other  debts  of  the  company,  were 
to  be  "  charged  and  chargeable  upon  the  revenues  of 
India  alone."  Thus  the  annual  interest  which  India 
had  till  then  paid  on  the  capital  of  the  company  was 
made  permanent.  Is  there  anything  parallel  to  this  in 
the  history  of  the  world? 

By  i860,  the  public  debt  of  India  had  risen  to  over 
one  hundred  million  pounds.  Since  then  it  has  gone 
upward  by  leaps  and  bounds.  In  191 3-14  the  total 
liabilities  of  the  Government  of  India  stood  at  iz^7r 
391,121.  The  argument  that  the  whole  of  this  debt  is 
a  commercial  transaction  from  which  India  got  a  re-, 
turn  in  the  shape  of  productive  works  is  on  the  fac^ 
of  it  untenable.  It  is  a  pity  that  eminent  Englishmen 
when  dealing  with  the  question  of  "  drain  "  should  ig- 
nore this  phase  of  the  question  and  always  harp  on 
the  misleading  statement  that  the  interest  paid  in  Eng- 
land represents  interest  on  capital  invested  in  India  on 
productive  works  for  which  India  got  a  fair  return  in 
the  shape  of  materials  supplied  by  England.  The  com- 
piler of  the  Imperial  Gazeteer  from  which  we  quoted 
above  makes  the  bald  statement  that  out  of  the 
total  home  charges  amounting  to  seventeen  and  three- 
quarter  millions  (of  what  year  it  is  not  stated)  nearly 
eleven  millions  "  consist  of  payments  on  account  of 
capital  and  materials  supplied  by  England." 

The  Extent  of  the  Drain:    It  is  impossible  to  state 


92  ENGLAND'S  DEBT  TO  INDIA 

in  pounds,  shillings  and  pence,  of  how  much  India  has 
been  drained  since  1757.  We  give  the  various  esti- 
mates made  by  Englishmen  themselves. 

Montgomery  Martin  wrote  in  1838: 

"  This  annual  drain  of  £3,000,000  on  British  India, 
amounted  in  thirty  years  at  12  per  cent,  (the  usual  In- 
dian rate)  compound  interest  to  the  enormous  sum  of 
£723,997,917  sterling;  ...  So  constant  and  accumu- 
lating a  drain  even  on  England  would  soon  have  im- 
poverished her;  how  severe  then  must  be  its  effects 
on  India,  where  the  wages  of  a  labourer  is  from  two- 
pence to  threepence  a  day? 

"  For  half  a  century  we  have  gone  on  draining  from 
two  to  three  and  sometimes  four  million  pounds  ster- 
ling a  year  from  India,  which  has  been  remitted  to 
Great  Britain  to  meet  the  deficiencies  of  commercial 
speculations,  to  pay  the  interest  of  debts,  to  support 
the  home  establishment,  and  to  invest  on  England's 
soil  the  accumulated  wealth  of  those  whose  lives  have 
been  spent  in  Hindustan.  I  do  not  think  it  possible  for 
human  ingenuity  to  avert  entirely  the  evil  effects  of  a 
continued  drain  of  three  or  four  million  pounds  a  year 
from  a  distant  country  like  India,  and  which  is  never 
returned  to  it  in  any  shape." 

Mr.  Digby  says; 

"  Estimates  have  been  made  which  vary  from 
£500,000,000  to  nearly  £1,000,000,000.  Probably  be- 
tween Plassy  and  Waterloo  the  last-mentioned  sum 
was  transferred  from  Indian  hoards  to  English  banks. 

"  In  estimating  the  loss  to  India  in  the  nineteenth 
century  the  start  must  be  made  with  Mr.  Martin's 
figures : 

"  Loss  to  India,  prior  to  1834-35  com- 
pound interest,  at  twelve  per  cent. .    £723,000,000 


"  TRIBUTE  "  OR  "  DRAIN  "  93 

"The  average  annual  loss,  taking  the 
trade  tables  alone,  has  been  shown 
to  be  about  £7,500,000.  If  that  sum 
for  the  whole  period  be  taken,  and 
a  charge  of  five  per  cent,  compound 
interest  be  made  (though  the  money 
and  produce  were  worth  vastly  more 
than  five  per  cent,  to  the  Indian 
banker,  merchant,  cultivator,  ar- 
tisan, and  to  all  others  in  India  who 
would  have  been  in  a  position  to 
employ  capital  to  good  account, 
were  worth  at  least  three  times  five, 
but  I  have  taken  only  five)  the  re- 
sult is  £4,187,922,732 


Total £4,910,922,732 


"  Thus,  the  adverse  balance  of  trade  against  India 
during  the  last  century,  even  at  the  low  rate  of  interest 
I  have  adopted,  reached  the  enormous  total  of  nearly 
£5,000,000,000.  If  one  could  follow  the  money  in  all 
the  ramifications  through  which,  in  India,  it  might  have 
passed,  its  fertilising  effect  in  every  one  of  the  five 
hundred  and  forty  thousand  villages,  its  accumulating 
power  ('money  makes  money')  fructifying  in  a  land 
where  its  expenditure  would  have  led  to  an  increase  in 
substance,  it  would,  even  then,  be  impossible  to  put  into 
words  the  grievous  wrong  which  (unwittingly  but,  all 
the  same,  culpably)  has  been  done  to  India. 

"  Now  that  I  have  reached  this  point  in  my  exposi- 
tion, I  turn  to  page  372-373  of  the  latest  issue  of 
*  Financial  and  Commercial  Statistics  '  for  another  pur- 
pose, and  find  that,  in  taking  £7,500,000  as  a  fair  esti- 
mate of  India's  annual  payments  to  the  India  Office,  I 
have  greatly  underestimated  the  facts.  I  ought  to 
have  reckoned  those  payments  at  £9,500,000  for  each 


94  ENGLAND'S  DEBT  TO  INDIA 

year.     The  '  Amounts  received  in  England  at  the  India 
Office  on  Account  of  India '  during  the  period  1834-35 

to  1898-99  were £610,389,135 

"  To  this  must  be  added  debt  in  Eng- 
land existing  at  the  end  of  1898-99.    £124,268,605 

Total ••    £734,657,740 

("Prosperous  British  India,"  pp.  224,  225.) 

"  The  figures  indicating  the  drain  of  capital  from 
India  to  England,  given  on  page  225,  must  be 
amended. 

"  Loss  to  India,  as  already  shown.  .£4,910,922,732 

"  Add,  for  remittances  to  England 
on  official  account,  not  shown  in 
the  trade  returns,  nearly  £2,000,- 
000  per  annum,  since  (and  in- 
cluding) 1834-5,  at  5  per  cent., 
per   annum   compound   interest.  .£1,044,980,684 

"  Borrowings  in  England  (net  re- 
maining after  conversions,  re- 
payments, etc £    124,268,605 

£6,080,172,021  " 

(Ibid,  p.  230.) 

Says  Mr.  H.  M.  Hyndman:  [Bankruptcy  of  India, 
pp.  56,  57  and  58.] 

"  Now  look  at  the  trade  figures  for  the  twenty  years : 
The  total  exports  and  imports  of  India,  from  1857  to 
1876  inclusive  amount  to  £997,063,848  and  £841,192,237 
respectively.  Discriminating  between  merchandise  and 
bullion  in  the  imports,  we  have  merchandise  to  the 
value  of  £569,835,243  imported  in  that  period,  and 
^271,356,994  worth  of  bullion.  Between  1857  and 
1876  the  total  export  and  import  trade  together  in- 
cr(  ased  from  £55,000,000  to  £103,000,000,  or  very 
nearly  doubled.  Nothing  could  be  more  satisfactory 
is  the  general  verdict.     Trade  doubled  capital.     Ex- 


"  TRIBUTE  "  OR  "  DRAIN  "  95 

ports  exceed  imports  —  that  is  all  right.     Great  inflow 
of  bullion  —  the  country  must  be  getting  richer. 

"  But  to  estimate  correctly  the  above  figures,  which 
are  calculated  at  the  Indian  ports,  it  is  obvious  that  at 
least  15  per  cent,  must  be  added  to  the  exports  for 
profit,  etc.,  and  that  therefore  the  value  of  the  imports 
to  balance  these  exports  should  not  be  less  than  £1,- 
145,000,000.^*  They  were  £841,000,000.  Here  is  a 
discrepancy  to  start  with  of  more  than  £300,000,000. 
Of  the  imports,  however,  £271,000,000  consisted  of 
bullion.  Now  of  this  £271,000,000,  certainly  not  less 
than  £120,000,000  represents  the  proceeds  of  loans 
raised  or  guaranteed  by  Government,  and  brought  into 
India  as  a  borrowed  fund,  wherewith  to  pay  the  wages 
of  labourers,  engineers,  etc.,  engaged  on  public  works. 
It  is  a  treasure  which  has  been  borrowed  for  a  definite 
period,  which  is  still  owing,  and  which  has  to  be  repaid. 
This,  therefore,  is  no  trade  import. 

"  We  have  thus  the  original  disparity  of  more  than 
£300,000,000  plus  £120,000,000  as  the  drain  from  India 
in  the  twenty  years.  That  amounts  to  £420,000,000,  or 
£21,000,000  a  year.  It  would  be  easy  to  show  that  the 
actual  drain  is  much  greater  than  this  when  the  opium 
profits,  and  the  import  of  treasure  to  carry  on  the  in- 
creased private  business  (which  is  also  a  loan),  are 
taken  into  account.  The  above  figures  are,  however, 
sufficient  to  establish  the  principle  for  which  I  contend 
—  that  the  export  trade  of  India  represents  a  most  ex- 
hausting drain  on  the  country. 

"  Even  leaving  out  the  profit  and  taking  no  account 
of  the  opium  monopoly,  India  has  sustained  a  drain  of 
nearly  £280,000,000  in  the  twenty  years.  The  exports 
for  1876-7  were  £65,000,000,  and  the  imports,  exclu- 
sive of  bullion,  were  £37,427,000,  with  bullion,  nearly 
£49,000,000." 

1*  "  The  reason  for  this  is,  that  the  estimate  of  value  is  made 
at  the  Indian  ports,  where  freight,  profit,  and  insurance  are 
calculated  in  giving  the  value  of  the  imports,  but  no  such  ad- 
dition is  made  for  the  exports." 


96  ENGLAND'S  DEBT  TO  INDIA 

It  is  remarkable  that  the  average  of  annual  drain 
struck  by  Mr.  Hyndman  for  the  20  years  from  1857  to 
1876  should  coincide  with  the  average  estimate  of 
"  potential  drain  "  found  by  Sir  Theodore  jMorison  on 
page  203  of  his  book,  "  The  Economic  Transition  of 
India"  (London,  191 1). 

He  says : 

"  On  the  vv^hole,  I  do  not  think  that  any  one  who 
studies  the  evidence  and  extends  his  calculations  over  a 
series  of  years  will  find  any  justification  for  estimating 
the  potential '  drain  '  at  more  than  i2i,ooo,0(X)  sterling." 

Writing  in  1882,  Mr.  A.  J.  Wilson,  late  editor  of  In- 
vestor's Review,  an  authority  on  finance,  fixed  the  fig- 
ure at  thirty  millions  sterling  a  year.^^  Writing  in 
1906  Mr.  Hyndman  estimated  the  drain  at  forty  mil- 
lions sterling  a  year,  but  Mr.  A.  J.  Wilson  thought 
that  thirty-five  millions  would  be  a  safe  figure,  though 
in  his  own  opinion  it  represented  a  low  estimate.^* 

Figures.  We  have  taken  the  figures  up  to  1898-99 
from  Mr.  Digby's  book.  The  figures  from  1898-99 
to  1913-14  are  given  below.  The  excess  of  exports 
over  imports  in  the  decade  from  1899-1900  to  1908-09 
is  as  below :  ^^ 

1899-1900  13,841,000 

1900-1901  10,983,000 

1901-1902  17,989,000 

1902-1903  18,570,000 

If* "  An  Empire  in  the  Pawn,"  by  A.  J.  Wilson,  London 
(1911),  p.  61. 

18 "  An  Empire  in  the  Pawn,"  by  A.  J.  Wilson,  London 
(1911),  pp.  64-65. 

17^  These  figures  are  taken  from  Sir  Theodore  Morison's 
book  as  being  likely  to  be  more  accurate,  though  they  do  not 
fully  tally  with  the  figures  given  in  the  statistical  abstracts. 


"  TRIBUTE  "  OR  "  DRAIN  " 


97 


1903-1904  24,893,000 

1904-1905  20,227,000 

1905-1906  22,360,000 

01906-1907  13,713,000 

a  1907-1908     2,665,000 

01908-1909     5,271,000 

o  These  were  the  years  when  the  Swadeshi  Boycott  was  in 
force  in  Bengal  as  also  in  other  parts  of  India. 

Total  for  the  decade  £150,512,000  or  $752,560,000. 

Total  Dis- 

Excess  of  Net  Home        bursetnents 

exports  charges  in  England 

from  1902-03 
to  1913-14 
£  £  £ 

1902-1903  17,667,016  25,730,325 

1903-1904  17,399728  31,491,699 

1904-1905  18,827,654  31,168,251 

1905-1906  17,666,233  51,429,591 

1906-1907  18,333,943  43,047,986 

1907-1908  17,768,630  36,669,171 

1908-1909  18,323,419  37,925,455 

1909-1910  22,794,990  18,411,709  40,082,753 

1910-1911  29,097,946  18,605,706  51,411,496 

1911-1912  27,224,951  18,865,246  43,092,806 

1912-1913  18,925,775  19,302,292  52,717,391 

1913-1914  14,228,512  19,455,055  45,274,370 

£112,272,174        £222,616,621 
Total  for  5        Total  for  12 
years  years 

The  figures  taken  from  the  48th  and  49th  Nos.  of  the 
Statistical  Abstract  relating  to  British  India  (1915  and 
1916). 

Mr.  Digby's  figures  of  drain  are  up  to  the  end  of  the  nine- 
teenth century.  We  will  leave  it  to  the  reader  to  add 
the  figures  for  the  13  years  of  the  twentieth  century  given 
above  and  find  out  for  himself  the  grand  total  of  the  drain 
from  India  up  to  the  end  of  1913-14. 

In  the  decade  covered  by  Sir  Theodore  Morison's 
book,  the  total  Home  Charges  (not  total  disburse- 
ments) amounted  to  £175,976,000,  while  the  total  ex- 
cess of  exports  for  the  same  period  was  only  £150,512,- 
000.     This  discrepancy  is  explained  by  Sir  Theodore 


98  ENGLAND'S  DEBT  TO  INDIA 

Morison  by  adding  loans  raised  in  England  and  sent 
to  India  in  the  shape  of  "  stores,  rails,  machinery,  etc." 
as  part  of  her  imports.  According  to  his  calculations 
"  the  direct  and  guaranteed  debt,  charged  on  the  reve- 
nues of  India"  increased  by  £41,931,036  during  the 
decade  from  1899-1900  to  1908-09,  Adding  this  sum 
to  the  total  excess  of  exports  during  the  decade,  he 
raises  the  sum  that  was  available  to  meet  the  Home 
Charges  to  £19,2/^4,000  per  annum  and  argues  that  the 
margin  of  £3,502,000  per  annum  thus  obtained,  is  suffi- 
cient "  to  defray  the  unknown  remittances  on  private 
account."  Following  this  line  of  argument  he  should 
have  deducted  from  imports  the  proceeds  of  loans 
raised  in  England  for  the  Government  of  India  in 
bullion.  Besides,  it  should  be  remembered  that  in  fix- 
ing the  amount  of  excess  of  exports  over  imports  Sir 
T.  Morison  takes  no  notice  of  the  fact  that  the  im- 
ports include  about  15  per  cent,  for  freight,  insurance, 
and  brokerage  and  that  the  exports  do  not  include  any 
of  these  items. 

Sir  Theodore  Morison  obtained  his  figures  about 
the  capital  liabilities  of  India  from  the  India  Office,  but 
the  figures  available  to  the  public  are  those  given  in  the 
Statistical  Abstracts  from  which  we  take  the  following 
information  for  the  years  1909-1910  to  1912-13.  In 
1909-10  the  permanent  debt  in  England  stood  at  £176,- 
105,911 ;  in  1912-13  it  rose  to  £179,179,193.  The  total 
liabilities  of  the  Government  of  India  at  the  end  of 
1913-14  were  £307,391,121 ;  on  these  liabilities  £5,912,- 
796  was  paid  for  interest  in  England  and  £4,210,848 
in  India. 


"  TRIBUTE  "  OR  "  DRAIN  "  99 

It  is  to  be  noted  that  in  1905-06  the  public  debt  of 
India  was  classified  as  follows :  — 

Railway  Irrigation  Ordinary 

^149,035,455  ^27,050,799  £54,425,226 

In  1906-07  an  alteration  was  made  in  the  method  of 
classifying  the  debt  by  which  the  portion  "  attribu- 
table "  to  Railways  was  raised  to  £168,344,748  and  that 
"  attributable  "  to  ordinary  debt  reduced  to  £37,917 - 
252. 

The  question  of  the  drain  for  India  is  thus  compli- 
cated by  several  factors.  The  excess  of  exports 
over  imports  is  not  a  safe  guide  (a)  because  the  value 
of  the  imports  include  shipping  charges,  insurance  and 
brokerage  in  addition  to  the  profits  made  by  the  manu- 
facturer and  the  importer  ( Messrs.  Hyndman  and  Wil- 
son have  estimated  these  charges  at  15  per  cent,  of  the 
total  value),  while  exports  are  represented  by  the  cost 
price  of  goods  (mostly  raw  produce  at  the  Indian 
ports).  The  only  thing  they  include  over  and  above 
the  price  realised  by  the  cultivator  is  the  railway  freight 
to  the  port  of  export  and  the  profit  and  commission  of 
the  middleman.^^  (b)  Because  the  debt  raised  in  Eng- 
land is  sometimes  spent  in  England  and  must  be  added 
to  the  exports  and  the  balance  sent  to  India  must  be  de- 
ducted from  imports;  (c)  because  private  remittances 
sent  by  British  servants  of  the  Government  and  Brit- 
ish merchants  and  manufacturers  in  India,  in  many 

18  See  Hyndman's  "  The  Bankruptcy  of  India,"  1886,  p.  57 
footnote  and  also  Mr.  Wilson's  "  An  Empire  in  the  Pawn,"^  p. 
54 ;  see  also  note  to  p.  462  of  the  "  Oxford  Survey  of  British 
Empire"   (Asia),  p.  462. 


100  ENGLAND'S  DEBT  TO  INDIA 

shapes,  are  not  necessarily  included  in  the  account; 
(d)  because  many  transactions  are  settled  by  exchange 
entries  in  books.  Many  English  firms  dealing  with  In- 
dia have  their  branch  offices  in  India  and  they  pay  for 
imports  not  always  in  exports.  Sometimes  they  in- 
vest large  sums  of  money  in  India. 

Mr.  J.  S.  Cotton  a  retired  Government  of  India 
official,  who  was  the  editor  of  the  Imperial  Gazeteer 
says : 

"  The  trade  for  export,  even  in  up  country  markets, 
is  largely  in  the  hands  of  a  few  European  firms  who 
make  their  purchases  through  brokers ;  and  the  busi- 
ness of  shipping  at  the  ports  is  almost  entirely  con- 
ducted by  European  firms  to  whom  the  Indian  traders 
consign  their  purchases  by  rail.  The  import  trade 
also  is  mainly  in  European  hands."  ^® 

It  might  be  added  that  a  fair  proportion  of  the  ex- 
ports are  purchased  by  European  firms  directly  from 
the  producer.^** 

On  the  preceding  pages  we  have  given  the  various 
estimates  made  by  Englishmen ;  those  made  by  Messrs. 
Martin,  Digby,  Hyndman  and  Wilson  on  the  one  side 
and  those  made  by  Sir  John  Strachey  and  Sir  Theo- 
dore Morison  on  the  other.  We  have  also  shown 
how  the  latter  explain  away  the  "  Drain."  In  the  Sta- 
tistical Abstract  of  1912-13,  the  total  interest  paid  in 
England  in  that  year  was  £6,203,996  but  in  the  table 
of  Expenditure  in  England  given  on  page  70  the  in- 
terest on  debt  was  as  follows: 

10 "The  Oxford  Survey  of  British  Empire"  (Asia),  p.  172. 
20  Ramsay  Macdonald's  "  Awakening  of  India,"  p.  106,  pop- 
ular edition. 


"  TRIBUTE  "  OR  "  DRAIN  "  loi 

Ordinary  £2,296,498 

Railways    8,979,898 

Irrigation 124,730 

Total    11,401,126 

The  total  expenditure  in  England  in  1912-13  was 
£20,279,572.  If  we  deduct  the  interest  paid  on  rail- 
way and  irrigation  debts,  there  will  be  left  a  balance  of 
over  eleven  millions  to  be  accounted  for.  Accepting 
the  arguments  of  Sir  Theodore  Morison,  we  may  also 
deduct  the  price  of  stores  supplied. 

Stationery  and  Printing  £  85,314 

Civil  Departments  253,585 

Marine  Stores 84,727 

Public  Works  144,773 

Military 788,309 

Miscellaneous   9,563 

Total    1,366,271 

Roughly  speaking  that  leaves  a  balance  of  a  little 
less  than  ten  million  pounds  as  expenditure  in  Eng- 
land for  which  India  got  no  return  in  any  shape  or 
form. 

It  will  also  be  noticed  that  the  Home  Charges  are  al- 
ways on  an  ascending  scale  and  the  excess  of  exports 
over  imports  has  risen  considerably  of  late;  i.e.,  since 
1908-09,  the  last  year  for  which  figures  were  given  by 
Sir  Theodore  Morison.  In  comparing  figures  of  past 
years  with  later  years  it  should  be  remembered  that 
the  figures  in  sterling  do  not  give  an  exact  idea  of  the 
increase.  The  economic  value  of  the  rupee  (the  unit 
of  Indian  coinage)  was  2s.  in  the  seventies  of  the  nine- 
teenth century.  It  is  is.  4d.  now,  and  that  makes  a 
huge  difference. 


102  ENGLAND'S  DEBT  TO  INDIA 

We  think  we  have  established  beyond  doubt  that : 

(1)  There  is  a  drain.  India  does  pay  a  tribute, 
which  the  Imperialists  call  compensation  for 
services  rendered. 

(2)  The  extent  of  the  drain  differs  according  to  the 
way  it  is  looked  at  by  different  persons. 

Mr.  Hyndman  fixed  the  amount  in  1906  at  forty  mil- 
lion pounds  sterling  per  annum  ; 

Mr.  Wilson  fixed  it  at  thirty-five  millions  per  an- 
num; 

Sir  Theodore  Morison  fixed  the  amount  of  what  he 
calls  "  potential  drain  "  at  twenty-one  millions.  Com- 
puted in  rupees  it  will  be  much  larger. 

In  an^case_this  is  sufficient  to  establish  the  fact  that 
Great  Britain  does  make  a  huge  profit  by  Jier  political 
ascendency  in  India. 


CHAPTER  IV 

HOW  INDIA   HAS   HELPED  ENGLAND  MAKE  HER  EMPIRE 

"  Perhaps  the  most  striking  testimony  to  the  virtue 
of  benevolent  despotism  is  seen  in  the  employment  of 
native  races  to  fight  our  battles  for  us.  .  .  .  Having  ex- 
tended the  Empire  by  bringing  the  *  inferior  races  * 
under  our  sway,  by  a  master  stroke  of  genius  we  utilise 
them  to  still  further  extend  and  also  to  defend  the  Em- 
pire, and  convert  them  into  instruments  for  bestowing 
upon  their  brethren  the  boons  which  they  themselves 
have  obtained.  It  is  very  largely  in  this  way  that  our 
Indian  Empire  has  been  built  up." 

— Mr.  J.  G.  GoDDARD,  M.  P. — "  Racial  Supremacy." 

India  and  "  The  Empire."  The  present  generation 
of  Englishmen,  born  into  conditions  of  extreme  pros- 
perity, at  a_time  when  their  country  is  at  the  zenith  of 
her  imperial  glory,  are  apt  to  forget  how  much  they 
owe  to  India.  _.l-  hey  ignore  the  fact  that  India  is  The 
Empire, —  pefRaps  the  only  Empire  they  have.  Shejs^ 
the  pivot  round  which  the  whole  Imperial  edifice  has 
been  built  and  revolvej!  The  self-governing  domin- 
ions  except  in  the  present  hour  of  war  contributed  little, 
if  anything,  to  the  prosperity  and  strength  of  the  Em- 
pire. So  far,  they  have  laid  more  emphasis  upon  their 
rights  than  their  duties,  which  they  scarcely  recog- 
nised at  all.  They  rendered  some  help  to  Great  Britain 
in  the  Boer  War,  and  have  splendidly  borne  their  share 

103 


A 


104  ENGLAND'S  DEBT  TO  INDIA 

in  the  present  titanic  struggle,  but  looking  at  their  past 
history,  they  have  got  immensely  more  from  the  Em- 
pire than  they  ever  gave  it. 

India,  on  the  other  hand,  has  always  been  the  "  milch- 
cow."  She^ has^  supplied,  the  Brijisl3.jsles  with  food, 
and  with  raw  products  to  be  turned  into  manufactured 
articles;  she  has  supplied  labour  to  deveT6p~thF-col- 
onies]  she  has  fought  for  the  Empire  in  almost  every — 
hemisphere.  She  affords  a  vast  field  for  all  kinds  of 
experiments;  she  is  the  training  camp  for  engineers 
and  generals  from  the  British.  liles.  This  point  was 
frankly  admitted  by  Lord  Roberts  in  the  evidence  he 
gave  before  the  Royal  Commission  on  Indian  Expendi- 
tures (97)  when  he  said:  "From  the  point  of  yjew 
of  training,  India  is  a  very  great  strength  to  the  United 
Kingdom." 

But^^at  is  even  more  significant,  India  conquered 
niQst  of  her  Empire  for_Gi^  her 

blood  and  her  resources  have  been  freely  used  by  Eng-^ 
land  to  make  new  acquisitions,  to  put  down  revolts  in 
existing  dominions,  and  to  maintain  her  prestige  in 
Europe.  At  the  time  of  the  Boer  War,  India  was  the 
first  to  send  an  expedition  to  the  Transvaal.  The  sarhe 
thing  happened  in  the  present  European  war;  the  In- 
dian expedition  reached  France  very  early  in  the  con- 
flict, and  helped  materially.  Since  then,  Indian  troops 
have  been  used  at  Gallipoli,  in  Mesopotamia  and  in 
Egypt.  India  herself  has  paid  the  bills.  Yet  when 
her  sons  talk  of  post-war  reforms  in  the  Administra- 
tion, they  are  rebuked  with  a  warning  not  to  be  sordid ! 
It  is  their  duty  to  shed  blood  for  their  great  bene- 
factor.    For  details  of  India's  contribution  to  this  war 


HOW  INDIA  HAS  HELPED  105 

in  men  and  money  see  the  Post-Scriptum  to  the 
Preface. 

In  this  chapter  we  purpose  showing  how  India  has 
helped  England  make  her  Empire.  It  would  be  well 
to  remember,  in  this  connection,  that  all  the  acquisi- 
tions of  the  East  India  Company  in  Asia  were  won 
through  their  Indian  Government  employing  Indian 
troops,  and  paying  the  cost  from  Indian  exchequers. 
It  was  the  East  India  Company  which  acquired  the 
Isle  of  France  (Mauritius)  the  island  of  Ceylon,  the 
settlement  and  port  of  Singapore,  and  other  islands  in 
the  Indian  Seas  now  in  possession  of  England.  It 
was  the  East  India  Company  which  originally  obtained 
foothold  in  Persia  and  Arabia,  conquered  Burmah,  and 
conducted  military  and  naval  operations  for  Great  Brit- 
ain whenever  the  latter  was  at  war  with  France,  Por- 
tugal or  Holland,  and  desired  to  strike  at  their  Asiatic 
and  African  holdings. 

The  following  table,  taken  from  the  Report  of  the 
Royal  Commission  on  Indian  Expenditures,  Vol.  II, 
page  305,  will  show  how  India  has  been  saddled  with 
the  expenses  of  the  various  wars  she  fought,  or  par- 
ticipated in,  for  the  glory  of  the  British  Empire. 

Foreign  Wars  Whose  Cost  Was  Charged  to  India 

Extra- 


Ordinary  Charges 

ordinary  Charges 

Expedition 

paid  by 

paid  by 

India      England 

India      England 

1st  Afghan  War 

all 

none 

all            none 

1838--P 

1st  China  War 

all 

none 

none            all 

1839-40 

Persian  War 

all 

none 

half          half 

1856 

io6 


ENGLAND'S  DEBT  TO  INDIA 


Extra- 

Ordinary Charges 

ordinary  Charges 

Expedition 

paid  by 

paid  by 

India 

England 

India      England 

Abyssinian  War 

all 

none 

none           all 

1867-68 

Perak   Expedition 

all 

none 

none           all 

1875 

2nd  Afghan  War 

all 

none 

all  except  £5,000,000 

1878-S0 

£5,000,000 

Egyptian  War 

all 

none 

all  except     £500,000 

1882 

£500,000 

Soudan  War 

all 

none 

none           all 

1885-86 

To  this  table,  we  append  the  following  extract  from 
the  same  Report,  showing  India's  expenditures  for 
Great  Britain's  consular  representation  in  Asia: 

"  The  Persian  mission  was  established  in  18 10  and 
maintained  at  the  charge  of  Great  Britain  until  1823, 
when  it  was  transferred  to  India.  From  1823-31  it 
was  wholly  supported  by  Indian  funds.  In  1835  it  was 
transferred  to  the  British  Foreign  Office,  the  Indian 
Government  contributing  i  12,000  a  year  towards  its 
cost.  Again,  in  1859,  the  mission  and  consulate  at 
Teheran,  Tabriz  and  Resht  were  placed  under  the  Gov- 
ernment of  India.  The  cost  of  the  mission  was  then 
estimated  at  £15,000  a  year,  towards  which  Great  Brit- 
ain contributed  £3,000,  with  £2,000  on  account  of  the 
consulate.  In  i860,  the  mission  and  consulate  were 
re-transferred  to  the  British  Foreign  Office  and  from 
1860-1880,  India  contributed  £12,000  towards  the  mis- 
sion, leaving  the  consulate  at  the  sole  charge  of  Great 
Britain.  In  1880-90,  the  Indian  contribution  was  re- 
duced to  £10,000  and  further  reduced,  in  1891,  to 
£7,000." 

That  India  has  been  unjustly  and  sometimes  ille- 
gally treated  in  this  respect,  will  be  clear  from  a  few 
extracts  we  submit  from  the  evidence  of  British  states- 


HOW  INDIA  HAS  HELPED  107 

men  given  before  the  Royal  Commission.  For  fuller 
material,  we  refer  the  reader  to  the  evidence  itself  and 
to  the  written  statements  of  Colonel  Hanna  and  Colo- 
nel Waterfield  in  Vol.  II,  India  not  only  pays  for 
a  huge  British  garrison  within  her  confines,  but  also 
for  all  the  expenses  incurred  in  connection  with  their 
enlistment,  training  and  equipment ;  for  all  pensions 
earned  by  the  men  and  officers  as  well  as  every  cent 
spent  on  medical  and  various  philanthropic  institutions 
maintained  for  their  benefit  in  England.  The  whole 
thing  is  so  unjust,  that  rather  than  trust  our  own  lan- 
guage to  express  our  feelings,  we  will  let  Lord  North- 
brook,  Sir  Henry  Brackenberry  and  Sir  Edward  Col- 
len  speak  about  it. 

Lord  Lansdowne  on  the  Indian  Army. 

I5'996  —  Mr.  Courtney — "Have  you  considered, 
Lord  Lansdowne,  from  the  point  of  view  of  India  her- 
self, supposing  she  were  isolated  from  Great  Britain, 
whether  it  would  be  necessary  to  maintain  a  force  such 
as  is  borrowed  from  the  United  Kingdom,  and  in  the 
same  degree  of  efficiency?  "  "  Certainly  not.  The  In- 
dian army  is  organised  with  a  view  to  its  employment 
upon  operations  which  have  nothing  to  do  either  with 
the  internal  policy  of  the  country,  or  the  mere  repres- 
sion of  tribal  disorders  on  the  frontier." 

15.997.  "  Then  the  difference  in  the  cost  of  training 
that  force  so  borrowed,  between  what  would  be  neces- 
sary for  Indian  purposes  and  the  standard  kept  up  for 
Imperial  and  Home  purposes,  should  be  borne  by  the 
home  exchequer?"  "Your  question  points  to  the 
principle  which  I  was  endeavouring  in  my  answers  to 
enforce." 

15.998.  "  That  we  for  home  and  Imperial  purposes, 
keep  the  army  at  a  higher  standard  of  efficiency  than 
India  taken  by  herself,  requires,  and  we  should  make 


io8         ENGLAND'S  DEBT  TO  INDIA 

that  a  consideration  in  settlement  of  charges  between 
the  two  countries  ?  "     "  Certainly." 

Lord  Roberts  on  India  as  Training  Ground  for  Brit- 
ish Army. 

15,664,  "  The  argument  that  India  affords  the  best 
training  ground  for  the  British  army  during  peace  is  a 
ground  for  reducing  the  home  charges  of  British  regi- 
ments in  India.  Any  one  who  has  served  in  India  must 
admit  it  affords  the  best  training  ground  for  troops  and 
this  should  not  be  lost  sight  of  in  apportioning  home 
charges.  I  doubt  if  any  country  is  so  peculiarly  well 
adapted  for  training  troops  as  India.  'From  the 
point  of  view  of  training,  India  is  a  very  great  strength 
to  the  United  Kingdom," 

Sir  Henry  Brackenberry  on  Indian  Army  Expendi- 
ture. 

i4,yS2.  "  The  army  in  India  is  largely  in  excess  of 
requirements  for  preserving  internal  peace.  The  for- 
eign policy  of  India  is  directed  entirely  from  England 
and  is  a  part  of  British  foreign  policy  in  general.  The 
object  of  British  foreign  policy  is  to  secure  British  rule 
over  the  British  Empire.  If  British  rule  were  main- 
tained in  India  only  for  India's  sake,  then  it  would  be 
fair  to  make  India  pay  everything  that  was  due  to  Brit- 
ain's rule  over  India,  But  I  cannot  but  feel  Britain's 
interest  in  keeping  India  under  British  rule  is  enor- 
mous, India  affords  employment  to  thousands  of  Brit- 
ons; India  employs  millions  of  British  capital;  Indian 
commerce  is  of  immense  value  to  Great  Britain,  It 
seems  to  me  Great  Britain  should  pay  her  share  of  ex- 
penditures, and  in  estimating  that  share,  she  should 
behave  generously,  because  England  is  a  rich  country 
and  India  a  poor  one ;  —  also  India  has  no  represen- 
tation ;  where  a  nation  is  arbitrarily  governed,  the  gov- 
erning power  should  behave  generously," 


HOW  INDIA  HAS  HELPED  109 

14,896.  "If  this  Royal  Commission  could  see  its 
way  to  recommend  the  abolition  of  all  those  accounts 
for  military  and  naval  services,  for  the  Secretary  of 
State's  salary,  and  the  expenses  of  the  India  Office,  for 
diplomatic  and  consular  charges  in  Persia  and  China 
and  elsewhere,  and  to  substitute  for  them  a  fixed  con- 
tribution from  India,  many  constant  causes  of  irritation 
would  be  removed,  and  it  would  do  much  to  convince 
all  classes  of  India  of  the  desire  of  this  country  which 
rules  India,  to  treat  her  justly  and  generously." 

Sir  Edwin  Collen  on  the  Apportionment  of  Ex- 
penses. 

6,igy.  "The  division  between  the  British  and  In- 
dian Treasuries  of  the  charges  for  European  troops  in 
India  should  be  determined  with  special  reference  to  the 
fact  that  the  military  forces  of  the  United  Kingdom  are 
organised  to  meet  the  requirements  of  the  whole  Em- 
pire, that  India  has  no  voice  in  deciding  on  the  nature 
of  such  organisation,  and  that  she  as  a  poor  country 
is  made  to  enter  into  partnership  with  England,  one 
of  the  wealthiest  in  the  world.  India's  contribution 
should  be  decided  with  reference  to  the  relative 
wealth  of  India  and  England,  to  the  fact  that  India, 
supplies  a  great  training  ground  for  the  British  part  of 
the  Indian  army.  That  a  contribution  should  be  made 
by  the  Imperial  Exchequer  towards  the  cost  of  fortifi- 
cations which  have  been  erected  on  the  frontier,  or  to 
defend  the  ports  of  India  against  attack  by  great  Euro- 
pean powers,  and  that  England  should  bear  a  share  of 
the  cost  of  Aden,  which  is  practically  an  Imperial  for- 
tress. That  this  is  not  to  be  regarded  as  a  matter  of 
generosity,  but  of  justice  and  legality." 

Lord  Northbrook  on  Wars  Outside  India. 

14,108.  "  Have  you  paid  any  attention  to  the  ar- 
rangements made  for  the  payment  of  troops  lent  by  In- 
dia for  service  outside  the  country  ?  "     "  Yes,  I  have 


no  ENGLAND'S  DEBT  TO  INDIA 

had  occasion  to  give  considerable  attention  to  this  mat- 
ter." 

14.109.  "  Do  you  think  that  fair  treatment  has  been 
given  to  India  in  the  apportionment  of  these  charges?  " 
"  I  think  India  has  been  hardly  treated." 

14.110.  "Could  you  go  through  the  various  cases 
and  give  us  your  reasons?  "  "  The  cases  will  be  found 
in  Sir  Henry  Waterfield's  Memorandum  in  the  Appen- 
dix, page  364.  .  .  ." 

14.119.  "  Do  you  remember  the  ground  upon  which 
the  Government  decided  that  India  had  an  interest  in 
the  Abyssinian  Expedition?"  "No,  I  should  like  to 
see  it  —  I  never  heard  of  it.  I  believe  a  protest  was 
made  at  the  time." 

14.120.  "  I  am  speaking  from  memory.  Was  it  not 
put  forward  that  the  Government  of  India  was  con- 
cerned, because  Abyssinia,  being  within  the  purview  of 
India,  you  may  say  the  prestige  of  the  English  name 
must  not  be  endangered  by  allowing  any  official  Eng- 
lish subjects  to  be  taken  prisoner?"  "The  idea  may 
have  been  put  forward.  I  do  not  think  any  impartial 
person  would  have  paid  the  slightest  attention  to  it." 

14,121 — Mr.  Courtney — "I  remember  a  French 
critic  arguing  at  the  time  that  the  war  was  for  the  pur- 
pose of  discovering  a  sanatorium  for  English  troops  ?  " 
"  That  would  be  a  better  reason  than  the  one  adduced 
as  regards  prestige.  Then  I  come  to  the  next  case,  — 
the  Perak  Expedition,  I  cannot  conceive  any  one 
doubting  that  India  has  been  hardly  treated.  An  ex- 
pedition beyond  the  frontier  of  India,  and  for  which,  to 
apply  any  portion  of  the  Indian  revenue,  it  is  by  statute 
necessary  to  address  the  Crown  from  both  Houses  of 
Parliament.  I  was  Governor  General  at  the  time,  and 
protested  at  this  charge  being  put  upon  India.  No 
notice  was  taken  of  the  protest,  made  by  the  Govern- 
ment of  India,  and  not  even  were  the  statutory  ad- 
dresses from  both  Houses  moved,  so  the  law  was 
broken,  and  the  charge  made  upon  India  has  never 
been  repaid." 


HOW  INDIA  HAS  HELPED  in 

14,124.  "  Have  you  mentioned  the  Egyptian  opera- 
tion of  1882?"  "That  is  the  next  case.  There  was 
no  doubt  that  as  regards  keeping  the  Suez  Canal  open, 
India  had  a  substantial  interest.  The  question  was, 
what  interest  ?  It  was  intended  that  India  should  pay 
the  whole  cost  of  the  expedition  that  was  sent.  The 
English  Government  was  put  to  considerable  cost,  and 
we  thought  India  would  be  put  to  small  cost,  so  might 
fairly  pay  the  cost  of  troops  sent  to  Suez.  The  opera- 
tions became  very  extended  and  the  expedition  from 
India  became  a  large  one.  The  whole  cost  was  1,700,- 
000  pounds.  India  paid  1,200,000  pounds  and  Eng- 
land 500,000.  The  Government  of  India  thought  it 
had  been  hardly  treated,  and  looking  at  it  now,  I  must 
say  it  would  have  been  better  if  we  had  charged  India 
half." 

14,127  —  Soudan  War — "Would  you  consider,  un- 
der the  original  plan,  India  was  sufficiently  interested  in 
the  expedition  to  justify  her  being  called  on  to  contrib- 
ute ?  "  "  No,  certainly  not.  I  do  not  think  there  was 
a  substantial  interest  of  India  in  any  expedition  to  the 
Soudan.  By  statute,  the  Indian  revenues  are  not  to  be 
used  except  after  addresses  from  both  Houses  of  Par- 
liament; in  my  opinion,  the  continued  employment  of 
the  Indian  troops  at  Suakim  as  a  garrison  was  not  cov- 
ered by  the  address.  As  to  the  force  sent  to  Suakim 
last  year,  certainly  India  should  not  have  been  charged." 

14,166.  "To  sum  up  what  I  have  put  before  the 
Commission,  I  think  if  the  ordinary  charges  of  the 
Abyssinian  War  were  600,000  pounds,  India  has  a  fair 
and  equitable  ground  to  claim  that  sum.  The  whole  of 
the  Perak  charges  ought  to  be  paid.  The  whole  of  the 
garrison  charges  at  Suakim  ought  to  be  refunded  to 
India.  On  equitable  grounds,  £350,000  ought  to  be 
given  India  for  the  Egyptian  Expedition  of  1882, —  be- 
cause India  has  been  inequitably  and  in  some  cases,  il- 
legally treated  during  many  years,  I  do  not  see  any 
reason  why  that  treatment  should  not  be  redressed  by 
some  action  at  the  present  time." 


112  ENGLAND'S  DEBT  TO  INDIA 

We  will  conclude  this  chapter  with  a  few  instances, 
illustrating  further  India's  contribution  to  the  making 
of  the  British  Empire: 

The  First  Treaty  with  Persia.  The  first  British  em- 
bassy to  Persia  was  sent  from  India  at  the  expense  of 
the  Indian  exchequer.  "  The  Embassy,"  to  use  the 
words  of  the  negotiator,  "  was  in  a  style  of  splendour 
corresponding  to  the  character  of  the  monarch  and  the 
manners  of  the  nation,  to  whom  it  was  sent;  and  to 
the  wealth  and  power  of  that  state  from  which  it 
proceeded." 

Commenting  on  the  above  quotation,  Mill  remarks : 

"  A  language,  this,  which  may  be  commonly  inter- 
preted, lavishly,  or,  which  amounts  to  the  same  thing, 
criminally  expensive." 

The  negotiator  continues :  "  It  was  completely  suc- 
cessful in  all  its  objects.  The  King  of  Persia  was  not 
only  induced  by  the  British  envoy  to  renew  his  attack 
upon  Khurassan,  which  had  the  effect  of  withdrawing 
Zamanshah  from  his  designs  upon  India ;  but  entered 
into  treaties  of  political  and  commercial  alliance  with 
the  British  Government."  ^ 

For  the  terms  of  the  treaty,  we  quote  again  the 
language  of  Mill: 

"  It  was  stipulated  that  the  King  of  Persia  should  lay 
waste,  with  a  great  army,  the  country  of  the  Afghans, 
if  ever  they  should  proceed  to  the  invasion  of  India, 
and  conclude  no  peace  without  engagements  binding 
them  to  abstain  from  all  aggressions  upon  the  English : 
that  should  any  army  belonging  to  the  French,  attempt 

1  Malcolm's  Sketch,  p.  31,  quoted  by  James  Mill,  Bk.  VI, 
Ch.  9,  p.  187. 


HOW  INDIA  HAS  HELPED  113 

to  form  a  settlement  on  any  of  the  islands  or  shores  of 
Persia,  a  force  should  be  employed  by  the  two  con- 
tracting states  to  co-operate  for  their  extirpation, —  and 
if  any  individuals  of  the  French  nation  should  request 
permission  to  reside  in  Persia,  it  should  not  be  granted. 
In  the  Furman,  annexed  to  the  treaty,  and  addressed  to 
the  governors  and  officers  in  the  Persian  Provinces,  it 
was  said:  'Should  any  person  of  the  French  nation 
attempt  to  pass  our  ports  or  boundaries,  or  desire  to  es- 
tablish themselves  either  on  the  shore  or  frontiers,  you 
are  to  take  means  to  expel  or  extirpate  them,  and  never 
to  allow  them  to  obtain  a  footing  in  any  place,  and  you 
are  at  full  liberty,  and  authorised,  to  disgrace  or  slay 
them.'  Though  the  atrocious  part  of  this  order  was 
no  doubt  the  pure  offspring  of  Persian  ferocity,  yet  a 
Briton  may  justly  feel  shame  that  the  ruling  men  of  his 
nation,  a  century  ago,  could  contemplate  with  pleasure 
so  barbarous  and  inhuman  a  mandate,  or  endure  to 
have  thought  themselves,  except  in  the  very  last  neces- 
sity, its  procuring  cause." 

"  The  Embassy  proceeded  from  Bombay  on  Decem- 
ber 29,  1799.  *  These  treaties,'  says  Malcolm,  '  while 
they  excluded  the  French  from  Persia,  gave  the  Eng- 
lish every  benefit  they  could  desire  from  the  connec- 
tion.' " 

It  appears,  from  Wilson's  "  History  of  India " 
that  the  East  India  Company  had  been  maintaining  a 
Resident  at  Bagdad  for  many  years  before  the  English 
Government  resolved  to  send  an  ambassador  to  the 
Persian  Court.  The  allowances  of  "  His  Majesty's 
Envoy  Extraordinary  and  Plenipotentiary,  Sir  Hart- 
ford Jones,  and  the  cost  of  the  mission  "  were  de- 
frayed by  the  Company,  and  the  Envoy  was  to  act  un- 
der instructions  from  the  Governor-General  in  India. 
The  latter  had  meanwhile  sent  his  own  representative 
in  the  person  of   Sir  John  Malcolm,  and  protested 


114  ENGLAND'S  DEBT  TO  INDIA 

against  the  English  Government  sending  their  own 
ambassador  to  the  Court  of  Persia,  but  his  protests 
were  unheeded,  and  upon  this  precedent,  ambassadors 
to  Persia  were  from  that  time  forward  sent  directly 
from  the  Court  of  St.  James. 

In  1 819,  expeditions  were  sent  from  Bombay  for  the 
subjugation  of  certain  Arab  tribes.  A  political  station 
had  been  maintained  for  a  time  at  Kishme  Mocha, 
where  an  officer  was  employed  by  the  Company  to 
superintend  the  affairs  of  its  subjects.  This  station 
was  bombarded  in  1879,  and  the  Chief  taken  prisoner. 

In  1828,  the  Indian  Government  paid  to  the  Shah 
of  Persia  two  hundred  thousand  Tomans  as  an  equiva- 
lent for  the  final  abrogation  of  the  Treaty  of  Teheran. 

Other  Nations  of  Asia.  In  Chapter  VI.,  Book  i  of 
his  "  History  of  India,"  Wilson  speaks  of  Lord  Minto 
being  "  busily  and  anxiously  engaged  in  asserting  the 
ascendency  of  the  British  Empire  in  India  over  the 
other  nations  of  Asia."  The  cost  of  every  expedition 
into  the  Persian  Gulf,  whether  against  the  Persians,  the 
Arabs  or  the  Afghans,  was  of  course,  defrayed  by  the 
Indian  Revenues.  We  are  told  besides,  that  "  the 
attention  of  Lord  Minto  was  earnestly  fixed  upon  ob- 
jects of  European  as  well  as  Indian  interest,  arising 
out  of  the  war  which  raged  in  the  Western  hemi- 
sphere." As  a  result  of  that  interest,  an  expedition 
was  sent  from  India,  at  the  cost  of  India,  to  reduce  the 
Portuguese  possession  of  Macao  in  Chinese  territory. 
The  expedition  failed,  owing  to  the  refusal  of  the 
Chinese  to  permit  the  British  to  occupy  Macao,  but 
this  failure  was  "  more  than  redeemed  by  the  success 
which  attended  the  employment  of  the  resources  of 


HOW  INDIA  HAS  HELPED  115 

British  India  in  the  furtherance  of  objects  of  greater 
importance  to  the  nation." 

Isle  of  France.  It  was  reserved  for  Lord  Minto's 
administration  to  effect  the  extirpation  of  the  remains 
of  French  colonial  possessions  in  the  Eastern  hemi- 
sphere, "  that  had  so  long  been  suffered  to  inflict  hu- 
miliation and  injury  upon  the  subjects  "  of  Great  Brit- 
ain. It  was  this  motive  and  this  excuse  which  actuated 
Lord  Minto  to  attempt  the  conquest  of  the  Isles  of 
France  and  of  Java.  The  expedition  was  successful, 
and  though  the  Isle  of  Bourbon  was  subsequently  re- 
stored to  France  when  peace  in  Europe  was  declared, 
the  Isle  of  France,  or  the  Mauritius,  is  still  subject  to 
Great  Britain  as  one  of  her  Crown  Colonies,  quite  apart 
from  India. 

The  Muluccas.  The  Muluccas,  Batavia,  and  other 
Dutch  possessions,  including  Java,  were  also  captured 
at  this  time  by  Indian  expeditions  sent  out  by  Lord 
Minto.  Under  the  Treaty  of  1844  the  Dutch  posses- 
sions were  restored  to  Holland. 

Ceylon.  In  1796,  Ceylon  was  taken  from  the  Dutch, 
as  being  identified  with  the  Republic  of  France,  by  an 
expedition  fitted  out  from  Madras.  For  a  short  time 
it  was  subject  to  the  government  of  Fort  St.  George, 
but  in  1798  was  annexed  as  a  Crown  Colony  of  the 
British  Government. 

Eastern  Archipelago;  Straits  of  Malacca  and  Singa- 
pore. According  to  the  terms  of  the  treaty  of  1814, 
made  with  the  Dutch,  the  latter's  settlements  in  the 
East  were  restored  to  them,  but  "  no  provision  was 
made  for  the  continued  observance  of  those  compacts 
which  had  been  formed  by  the  English  while  occupying 


ii6  ENGLAND'S  DEBT  TO  INDIA 

Java,  with  the  independent  Native  States."  The 
Dutch  consequently  did  as  they  pleased  with  the  latter, 
and  "  extended  their  chains  of  supremacy  over  all  the 
native  princes,  whom  it  was  their  interest  to  control  — 
an  invariable  article  of  their  engagements  being  the 
exclusion  of  all  other  European  ships  from  their 
ports."  This  policy  excited  the  resolve  of  the  British 
Government  to  strengthen  and  preserve  its  own  con- 
nection in  the  Archipelago  so  as  to  preserve  the  free 
passage  of  the  Straits  of  Malacca,  the  other  great 
thoroughfare  to  the  China  Sea.  The  Governor  of  Ben- 
coolen  was  accordingly  appointed  "  Agent  to  the  Gov- 
ernor-General of  India,  in  charge  of  British  interests  " 
to  the  eastward  of  the  Straits,  and  in  "  anticipation  of 
the  sanction  of  the  British  Government,"  Singapore, 
the  key  to  all  maritime  activities  in  the  China  Sea,  was 
occupied. 

Siam  and  Cochin-China.  In  November  of  the  year 
182 1,  the  British-Indian  Government  sent  a  mission  to 
Bangkok,  capital  of  Siam,  to  open  commercial  inter- 
course with  that  country  and  Cochin-China.  Failing 
to  obtain  its  designs  in  Siam,  the  mission  proceeded  to 
Cochin-China  and  there  obtained  permission  from  the 
King  of  that  country  to  trade  in  the  principal  ports  on 
the  same  terms  conceded  to  the  Chinese. 

Burmah.  The  first  war  with  Burmah  occurred  in 
1824,  was  conducted  with  Indian  troops,  and  paid  for 
from  the  Indian  exchequer.  It  resulted  in  the  annexa- 
tion of  Arakan,  Tenaserim  and  other  parts  of  Burmah 
to  the  British  Dominions. 

Malacca.  In  1831,  a  revolt  in  Malacca  was  put 
down  by  an  expedition  of  Indian  troops  sent  there, 


HOW  INDIA  HAS  HELPED  117 

resulting  in  the  annexation  of  Nauring  to  Malacca. 

The  China  Consular  Representatives.  The  East  In- 
dia Company  bore  the  whole  expense  of  diplomatic  in- 
tercourse with  China  as  long  as  it  enjoyed  the  mon- 
opoly of  British  trade  with  that  country.  The  Com- 
pany made  the  profit  and  the  Indian  people  paid  the 
expenses.  The  monopoly  ceased  in  1834,  and  thence- 
forth it  was  decided  that  Great  Britain  should  pay  two- 
thirds,  India  one-third  of  the  cost  of  the  superintend- 
ents of  trade  who  were  to  represent  diplomatic  inter- 
ests in  China.  In  1876,  the  arrangement  was  revised, 
and  India  paid  a  fixed  contribution  of  £15,000  a  year, 
reduced  in  1891  to  £12,500.  This  was  put  upon  the 
ground  of  the  opium  trade  with  China,  which  has  now 
been  discontinued. 

Aden.  India  bears  the  whole  charge,  civil  and  mil- 
itary, for  Aden,  which  is  not  an  Indian  port  but  an 
Imperial  dependency,  from  which  the  rest  of  the  Em- 
pire, including  Australia,  derive  more  benefit  than 
India. 

The  Zanzibar  and  Mauritius  Cable.  The  Govern- 
ment of  India  pays  one-half  the  subsidy  for  this  cable, 
although  Sir  David  Barbour,  the  Finance  Minister  at 
the  time,  objected  to  incurring  this  expenditure,  be- 
cause in  his  opinion,  "  the  duty  of  protecting  commerce 
on  the  high  seas  should  devolve  upon  England." 

The  Red  Sea  Telegraph.  India  contributed  one- 
half  the  £36,000  annuity  which  was  payable  until  1908 
for  this  useless  cable. 

In  conclusion,  we  cite  the  words  of  Mr.  Thorburn, 
ps&c  350  of  his  book,  "  The  Punjab  in  Peace  and 
War": 


Il8  ENGLAND'S  DEBT  TO  INDIA 

"  The  Government  of  India  in  their  foreign  proceed- 
ings are  irresponsible  and  in  pursuit  of  the  chimera  of 
high  politics,  sometimes  a  mere  mount  for  vaulting 
ambitions,  they  plunge  lightheartedly  into  adventures 
and  wars  which  may  benefit  a  few  individuals,  but  in- 
jure the  people  of  India  collectively.  When  things  go 
wrong  in  India,  hardly  a  voice  is  raised  against  the 
wrong-doers ;  officers  may  not  speak,  the  press  has  little 
information,  and  if  it  had  more,  is  timid,  the  line  be- 
tzveen  treason  and  criticism  being  finely  drawn;  and  as 
for  the  masses  —  their  horizon  is  the  evening  meal, 
and  the  next  instalment  of  the  revenue  demand. 
"  We  give  the  following  instances : 

1.  Lord  Lytton's  Afghan  Wars  —  'India  bleeds  si- 
lently.' 

2.  In  1890,  our  M^ars  of  pinpricks  cost  six  or  seven 
million  pounds  sterling.  Once  more,  *  India  bleeds 
silently.' 

3.  An  agent  trails  his  coat  in  Chitral,  a  war  follows, 
India  pays  and  the  agent  is  knighted  and  pro- 
moted. 

4.  The  events  of  August  23,  1897,  take  place  beyond 
the  Khyber  Pass,  a  serious  war  follows.  Once 
more,  India  bleeds, —  this  time,  happily,  not  quite 
in  silence." 


PART  THREE 


CHAPTER  V 

THE  COTTON  INDUSTRY  OF  INDIA 

I 
HISTORICAL   SURVEY 


-J 


"The  birthplace  of  cotton  manufacture  is  India, 
where  it  probably  flourished  long  before  the  dawn  of  _^ 
authentic  history.  Its  introduction  into  Europe  took 
place  at  a  comparatively  late  period  where,  for  a  long 
time,  it  existed  like  a  tropical  plant  in  northern  lati- 
tudes, degenerate  and  sickly,  until,  by  the  appliance  of 
modern  art  and  science,  it  suddenly  shot  forth  in  more 
than  its  native  luxuriance."  (Baines,  History  of  Cot- 
ton Manufacture,  1835,  page  2). 

Early  Mention.  The  arts  of  spinning  and  weaving, 
which  rank  next  to  agriculture,  are  supposed  to  have 
been  invented  very  early  in  the  world's  history.  In  the 
time  of  Joseph,  1700  b.  c,  it  is  recorded  that  "  Pharaoh 
arrayed  him  in  vestures  of  fine  linen  " —  and  the  writer 
quoted  above  adds ;  "  it  is  extremely  probable  that  cot- 
ton was  manufactured  in  India  as  early  as  linen  in 
Egypt." 

Herodotus,  writing  about  445  b.  c,  stated  that  cot- 
ton was  the  customary  wear  of  the  Indians  of  that 
period.  The  subsequent  writings  of  Europeans  and 
Asiatics  testify  to  the  same  fact.  Strabo,  whose  au- 
thority is  Nearchus,  mentions  "  their  flowered  cottons, 

121 


\l 


v/ 


122  ENGLAND'S  DEBT  TO  INDIA 

or  chintzes,  and  the  various  and  beautiful  dyes  with 
which  their  cloths  were  figured." 

The  first  mention  of  cotton  as  an  article  of  trade  oc- 
curs in  that  valuable  record  of  ancient  commerce,  "  The 
Circum  Navigation  of  the  Erystheaen  Sea,"  by  Arrian, 
an  Egyptian  Greek  living  in  the  first  or  second  cen- 
tury A.  D.  He  describes  particularly  the  imports  and 
exports  of  several  Indian  towns,  in  their  trade  with 
the  Arabs  and  Greeks.  From  this  record,  it  appears 
that  the  Arab  traders  brought  Indian  cottons  to  Aduli, 
a  port  of  the  Red  Sea ;  that  the  ports  beyond  the  Red 
Sea  had  an  established  trade  with  Batala,  on  the  Indus, 
Ariake  and  Bazygaza  (the  modern  Baroach)  ;  receiv- 
ing from  them  among  other  things,  cottons  of  various 
weaves ;  that  Barygaza  largely  exported  calicoes,  mus- 
lins and  other  cotton  goods  made  in  the  province  for 
which  this  was  the  port,  as  well  as  in  the  more  remote 
provinces  of  the  interior.  Mosalia,  or  Masulipatam, 
was  famous  then  as  now  for  its  manufacture  of  cot- 
ton piece  goods,  and  the  muslins  of  Bengal  were  supe- 
rior to  all  others,  receiving  from  the  Greeks  the  name 
of  Gangi, —  i.e.,  made  on  the  banks  of  the  Ganges. 

In  the  days  of  the  Roman  Empire,  silk,  both  raw 
and  manufactured,  was  an  important  article  of  com- 
merce throughout  India  and  Persia.  Two  Persian 
monks  brought  silk-worms  and  the  art  of  silk  manu- 
facture from  China  to  Constantinople,  in  the  reign  of 
Justinian,  352  a.  d.  Indian  cotton  goods  were  im- 
ported into  the  Eastern  Empire  in  the  same  age,  as  they 
are  found  in  the  lists  of  dutiable  goods  in  the  Justinian 
Code. 

From  India,  the  art  of  cotton  manufacturing  went  to 


THE  COTTON  INDUSTRY  OF  INDIA       123 

Arabia.  The  English  word  "  cotton  "  is  a  modification 
of  the  Arabian  "  Quttan."  Marco  Polo  states  that 
cotton  was  abundantly  grown  and  manufactured  in 
all  the  provinces  on  the  Indus, —  and  was  the  staple 
manufacture  of  the  whole  of  India.  In  the  thirteenth 
century,  the  art  of  cotton  manufacture  went  to  China 
and  thence  to  Japan.  In  the  tenth  century  it  travelled 
to  Spain,  being  introduced  by  the  Moors,  and  thence 
to  Italy  about  the  fourteenth  century.  The  Moham- 
medans introduced  it  into  Africa  even  earlier.  Thus 
it  spread  east  and  west,  "  from  its  native  seat  in  India 
across  the  breadth  of  the  old  continent  to  Japan  east- 
ward and  the  mouths  of  the  Tagus  and  Senegal  west- 
ward."    (Baines,  page  47.) 

Excellence  of  Indian  Cotton  Fabrics. 

"  The  Indians  have  in  all  ages  maintained  an  un- 
approached  and  almost  incredible  perfection  in  their 
fabrics  of  cotton  —  some  of  their  muslins  might  be 
thought  the  work  of  fairies  or  insects,  rather  than  of 
men,"  said  Baines  in  1835,  when  Indian  fabrics  were 
still  being  made.  The  Arabian  travellers  of  the  ninth 
century  say ;  "  In  this  country,  India,  they  make  gar- 
ments of  such  extraordinary  perfection,  that  nowhere 
else  is  their  like  to  be  seen, —  sewed  and  woven  to  such 
a  degree  of  fineness,  they  may  be  drawn  through  a 
ring  of  moderate  size."  Marco  Polo  (thirteenth  cen- 
tury) says :  "  The  Coast  of  Coromandel  and  especially 
Masulipatam,  produce  the  finest  and  most  beautiful 
cottons  to  be  found  in  any  part  of  the  world." 

Many  authorities  show  the  quality  of  cotton  cloth 
manufactured  in  India  up  to  the  end  of  the  eighteenth 


^ 


124         ENGLAND'S  DEBT  TO  INDIA 

century.  In  spite  of  the  raw  material  not  being 
brought  to  its  highest  state  of  cultivation,  despite  crude 
machinery  and  Uttle  division  of  labour,  the  products 
were,  according  to  Baines,  "  fabrics  of  exquisite  deli- 
cacy unrivalled  by  any  other  nation,  even  those  best 
skilled  in  the  mechanic  arts."  He  ascribes  its  excel- 
lence to  the  "  remarkable  fine  sense  of  touch,  and  the 
patience  and  gentleness  of  the  Hindus," 

Even  now,  fine  muslins  are  woven  in  India,  but  since 
the  introduction  of  machine-made  cloths,  the  industry 
has  suffered  both  in  quantity  and  in  quality. 

Extent  of  the  Cotton  Industry  in  Olden  Times. 

"  On  the  coast  of  Coromandel  and  the  province  of 
Bengal,  it  is  difficult  to  find  a  village  in  which  every 
man,  woman  and  child  is  not  employed  in  making  a 
piece  of  cloth.  At  present  much  of  the  greatest  part 
of  the  provinces  are  employed  in  this  single  manufac- 
ture (409).  The  progress  of  the  linen  (cotton) 
manufacture  includes  no  less  than  a  description  of  the 
lives  of  half  the  inhabitants  of  Hindustan."  ^ 

Upon  this  and  other  testimony,  Mr.  Baines  remarked 
in  1835  that  cotton  manufacture  in  India  was  not  car- 
ried on  in  a  few  large  towns  or  districts;  it  was  uni- 
versal. The  growth  of  cotton  was  nearly  as  general 
as  the  growth  of  food.  Bengal  was  noted  for  the 
finest  muslins ;  Coromandel  coast  for  chintzes  and  cali- 
coes; Surat  for  strong  and  inferior  goods  of  all  kinds; 
table  cloths  of  superior  quality  were  made  at  Patna. 
The  basius  or  basinets  came  from  the  northern  Cir- 
cars.     Condaver  furnished  the  beautiful  handkerchiefs 

lOrme:  in  "Historical  Fragments  of  The  Mogul  Empire," 
p.  413;  quoted  by  Baines,  p.  65. 


THE  COTTON  INDUSTRY  OF  INDIA      125 

of  Masulipatam,  the  fine  colours  of  which  are  obtained 
from  a  plant  growing  on  the  banks  of  Kishna  and  the 
coast  of  Bengal.  Chintzes  and  ginghams  were  made 
chiefly  at  Masulipatam,  Madras,  St.  Thome  and  Pa- 
liam  Cotta.  Long  cloths  and  fine  petticoats  came  from 
Madras.  Besides  these,  there  were  endless  varieties 
of  fabric  known  to  the  markets  of  Europe,  Asia  and 
Africa. 

Indian  commerce  was  extensive  from  the  Christian 
era  to  the  end  of  the  eighteenth  century.  For  many 
hundred  years,  Persia,  Arabia,  Syria,  Egypt,  Abys- 
sinia and  all  the  eastern  parts  of  Africa  were  supplied 
with  cottons  and  muslins  from  the  markets  of  India. 
Owing  to  the  beauty  and  cheapness  of  Indian  fabrics, 
the  manufacturers  of  Europe  were  apprehensive  of  be- 
ing ruined  by  their  Indian  competitors.  The  Dutch 
traders  and  the  East  India  Company  imported  large 
quantities  of  these  cotton  goods  in  the  seventeenth  cen- 
tury. As  early  as  1678,  a  loud  outcry  was  raised  in 
England  against  the  admission  of  Indian  fabrics,  which 
"  were  ruining  our  ancient  woollen  manufactures." 
We  quote  from  a  pamphlet  of  the  period: 

The  woollen  trade  "  is  much  hindered  by  our  own 
people  who  do  wear  many  foreign  commodities  instead 
of  our  own ;  .  .  .  instead  of  green  sey  that  was  wont  to 
be  used  for  children's  frocks,  is  now  used  painted  and 
Indian  stained  and  striped  calicoes;  .  .  .  and  some- 
time is  used  a  Bangale  brought  from  India,  both  for 
lynings  to  coats  and  for  petticoats  too.  ...  It  would 
be  necessary  to  lay  a  very  high  impost  on  all  such  com- 
modities as  these  are  .  .  ." 

A  writer  of  1696  laments  the  misfortune  of  Indian 


126  ENGLAND'S  DEBT  TO  INDIA 

muslins    and    silks    becoming    the    general    wear    in 
England. 

In  1708  Daniel  Defoe  wrote  in  his  weekly  review: 

"  The  general  fansie  of  the  people  runs  upon  East 
India  goods  to  that  degree  that  the  chintes  and  painted 
calicoes,  before  only  made  use  of  for  carpets,  quilts, 
etc.,  and  to  clothe  children  and  ordinary  people,  become 
now  the  dress  of  our  ladies;  and  such  is  the  power  of 
a  mode  as  we  saw  persons  of  quality  dressed  in  Indian 
carpets,  which  but  a  few  years  before  their  chamber 
maids  would  have  thought  too  ordinary  for  them ;  the 
chintz  was  advanced  from  being  upon  their  floors  to 
their  backs,  and  even  the  Queen  herself  at  this  time  was 
pleased  to  appear  in  China  silks  and  calicoe  ...  it 
crept  into  our  houses ;  our  closets,  and  bed  chambers ; 
curtains,  cushions,  chairs  and  beds  themselves  were 
nothing  but  calicoes  or  Indian  stufifs,  and  in  short,  al- 
most everything  that  used  to  be  made  of  wool  or  silk, 
relating  either  to  the  dress  of  our  women  or  the  fur- 
niture of  our  houses,  was  supplied  by  the  Indian 
trade." 

Defoe's  complaint  was  not  of  an  evil  existing  in  1708 
when  he  wrote,  but  of  one  a  few  years  earlier,  for  the 
prohibition  of  Indian  goods  had  taken  place  in  1700, 
by  Acts  II  and  12  of  William  III,  Cap.  10.  The  intro- 
duction of  Indian  silks  and  printed  calicoes  for  domes- 
tic use  as  either  apparel  or  furniture  was  forbidden 
under  penalty  of  £200  on  the  wearer  or  seller,  and  as 
this  did  not  prevent  the  use  of  Indian  goods,  other  acts 
were  passed  at  later  date.  This  "  evil "  of  the  con- 
sumption of  Indian  manufactures  did  not  disappear  by 
1728,  and  other  countries  of  Europe  were  making 
similar  efforts  to  penalise  the  import  and  use  of  Indian 
fabrics. 

Baines  says :     "  Not  more  than  a  century  ago,  the 


THE  COTTON  INDUSTRY  OF  INDIA      127 

cotton  fabrics  of  India  were  so  beautiful  and  cheap  that 
nearly  all  the  governments  of  Europe  thought  it  neces- 
sary to  prohibit  or  load  them  with  heavy  duties,  to 
protect  their  own  manufactures." 

What,  adds  he,  could  not  be  achieved  by  legislation 
in  Europe,  was  brought  about  by  the  exercise  of  politi- 
cal power  in  India.  This  is  evidenced  partly  by  the 
following  petition  submitted  by  the  natives  of  Bengal 
to  the  British  Government,  in  September,  1831 : 

"  To  the  Right  Honourable,  the  Lords  of  His  Majesty's 

Privy  Council  for  Trade,  etc. 

"  The  humble  petition  of  the  undersigned  Manufac- 
turers and  dealers  in  Cotton  and  Silk  Piece  goods,  the 
fabrics  of  Bengal ; 

"  Sheweth ;  that  of  late  years  your  petitioners  have 
found  their  business  nearly  superseded  by  the  intro- 
duction of  the  fabric  of  Great  Britain  into  Bengal,  the 
importation  of  which  augments  every  year,  to  the  great 
prejudice  of  native  manufactures. 

"  That  the  fabrics  of  Great  Britain  are  consumed  in 
Bengal  without  any  duties  levied  upon  them  to  protect 
native  fabrics. 

"  That  the  fabrics  of  Bengal  are  charged  with  the 
following  duties  when  they  are  used  in  Great  Britain : 

"  On  manufactured  cottons. ...   10  per  cent. 
On  manufactured  silks 14  per  cent. 

"  Your  petitioners  most  humbly  implore  your  Lord- 
ships' consideration  of  these  circumstances,  and  they 
feel  confident  no  disposition  exists  in  England  to  shut 
the  door  against  industry  of  any  part  of  the  inhabi- 
tants of  this  great  empire. 

"  They  therefore  pray  to  be  admitted  to  the  privilege 
of  British  subjects,  and  entreat  your  lordships  to  allow 
the  cotton  and  silk  fabrics  of  Bengal  to  be  used  in  Great 


128  ENGLAND'S  DEBT  TO  INDIA 

Britain  free  of  duty  or  at  the  same  rate  which  may  be 
charged  on  British  fabrics  sold  here. 

"  Your  Lordships  must  be  aware  of  the  immense  ad- 
vantage the  British  manufacturers  derive  from  their 
skill  in  constructing  and  using  machinery,  enabling 
them  to  undersell  the  unscientific  manufacturers  of 
Bengal  in  their  own  country;  and  although  your  Peti- 
tioners are  not  sanguine  in  expecting  to  derive  any  ad- 
vantage from  having  their  prayer  granted,  their  minds 
would  feel  gratified  by  such  a  manifestation  of  good 
will  towards  them;  and  such  an  instance  of  justice  to 
the  natives  of  India  would  not  fail  to  endear  the  British 
Government  to  them. 

"  They  therefore  confidently  expect  that  your  Lord- 
ships' righteous  consideration  will  be  extended  to  them 
as  British  subjects  without  exception  of  sect,  country, 
or  colour. 

"  And  your  Petitioners,  as  in  duty  bound,  will  ever 
pray." 

The  petition  was  signed  by  117  natives  of  high  re- 
spectability.    (P.  82.) 

In  a  footnote,  Baines  remarks  that  "  this  reasonable 
request  has  not  been  complied  with,  the  duty  on  Indian 
cottons  being  still  10  per  cent.  The  extra  duty  of 
3>^d.  per  yard  on  printed  cottons  was  removed  when 
the  excise  duty  on  English  prints  was  repealed,  in  183 1. 
English  cottons  imported  into  India  pay  duty  of  only 
2y2  per  cent."  This  document  in  his  opinion  fur- 
nished abundant  proof  how  a  manufacture  which  had 
existed  without  a  rival  for  thousands  of  years  with- 
ered away  under  the  competition  of  a  Power  which 
had  arisen  but  yesterday. 

Decline  of  the  Indian  Industry.  Let  us  enumerate 
the  causes  which  made  the  English  industry  flourish 
while  the  Indian  declined: 


THE  COTTON  INDUSTRY  OF  INDIA      129 

1.  The  invention  of  the  power  loom  and  other  me- 
chanical appliances  ranks  first.  But  these  might  have 
been  of  no  avail  had  not  the  capital  for  their  develop- 
ment been  taken  from  India,  as  shown  in  a  previous 
chapter. 

2.  The  monopoly  created  by  the  East  India  Com- 
pany in  their  own  favour. 

3.  The  imposition  of  a  heavy  tariff  in  England  on 
Indian  cottons.  The  following  scale  of  duties  on  im- 
ported cotton  goods  is  copied  from  Baines  (P.  325). 

Rate  of  Duty  on  Cotton  Goods  Imported 
East  India  East  India  Mus-  East  India 


White  Calicoes 

lins  and  Nankt 

?ens              Dyed  Goods 

per 

Piece 

Per  cent  ad  val.           Per  cent  ad  vol. 

s.d. 

L.    s.  d. 

L. 

s. 

d. 

1787  5  3 

&  16  10  0 

18 

0 

0                Prohibited 

1797  5  9 

&  18    3  0 

19 

16 

0 

1798  5  9 

&  21    30 

22 

16 

0 

1799  6  8  &  26    91 

30 

3 

9 

1802  6  8  &  27    II 

30 

15 

9 

1803 

59    I  3 

30 

18 

9 

1804 

6s  12  6 

34 

7 

6 

180s 

66  18  9 

35 

I 

3 

1806 

71    6  3 

37 

7 

I 

1809 

71  13  4 

2,7 

6 

8 

1813 

85    2  I 

44 

6 

8 

1814 

67  10  I 

37 

10 

0 

N.  B. 

The  importation  of  cotton  goods  other  than  from  the 

East  Indies,  was  inconsiderable  until  1825. 

Cotton  Manufactures  of  all  Sorts,  Not  Made  Up. 
1825  10  per  cent,  ad  valorem,  additional  duty  of  35^d. 

per  sq.  yd.  if  printed. 
1832  Repeal  of  the  additional  duty  of  3^d.  per  sq.  yd. 

on  printed  goods. 

Inspector  General's  Office,  Customs  House,  London, 
January  21,  18^4. 

Signed;    Wm.  Irving. 
In  1783  Parliament  passed  a  law  sanctioning  boun- 


130  ENGLAND'S  DEBT  TO  INDIA 

ties  on  the  exportation  of  British  printed  cottons,  viz. : 

Under  value  of  sd.  per  yd. ;   (before  printing)   l/zd.  per  yd. 
Value  5d.  under  6d.     "     "   ;      id.    per    yd. 
Value  6d.  under  8d.     "     "   ;  V/zd.      " 

Besides  the  Drazvback  of  the  Excise  Duty. 

These  bounties  were  continued  for  more  than  thirty 
years,  when  they  were  repealed.  The  duties  on  Indian 
goods  were  raised  from  time  to  time,  till  in  1813  and 
later,  up  to  1831,  they  stood  at  the  figures  quoted  below. 
The  following  statement  is  taken  from  the  evidence  of 
Mr.  Ricards  given  before  the  Select  Committee  of  the 
House  of  Commons  in  1813.  (See  Report  Appendix, 
page  581.) 

"  The  duties  of  many  articles  of  East  India  produce 
are  also  enormously  high,  apparently  rated  on  no  fixed 
principle,  and  without  regard  to  market  price. 
.  .  .  The  rates  of  duty  imposed  on  Indian  imports  into 
Britain  when  compared  with  the  exemption  from  duty 
of  British  staples  into  India  (cotton  goods  being  sub- 
ject to  a  duty  of  only  2^/2  per  cent),  constitute  an  im- 
portant feature  in  the  present  question.  Indians  within 
the  Company's  jurisdiction,  like  English,  Scotch,  or 
Irish,  are  equally  subjects  of  the  British  Government. 
To  make  invidious  distinctions,  favouring  one  class  but 
oppressing  another,  all  being  subjects  of  the  same  em- 
pire, cannot  be  reconciled  with  the  principles  of  justice ; 
and  whilst  British  imports  into  India  are  thus  so  highly 
favoured,  I  know  that  Indo-British  subjects  feel  it  a 
great  grievance  that  their  commodities  when  imported 
into  England  should  be  so  enormously  taxed." 

The  following  charges  on  cotton  manufactures  in 
1813  are  significant:  — 

£     s.  d. 
Flowered  or  stitched  muslins  of  white  calicoes  (for 

every  £100  of  value)    2'^    9    2 

And  further   (for  every  £100  of  value)    11   17     6 

Calicoes  and  dimities  (for  every  £100  of  value)....     81     2  11 
And  further  (for  every  £100  of  value)    3  19    2 


THE  COTTON  INDUSTRY  OF  INDIA       131 

£     s.  d. 

Cotton,  raw  (per  100  lbs.)   0  16  11 

Cotton,  Manufactured  (for  every  iioo  of  value)...     81     2  11 
Articles   of   manufacture   of  cotton,    wholly   or   in 
part  made  up,  not  otherwise  charged  with  duty 

(for  every  £100  of  value)   32    g    2 

(Digby,  p.  90.) 

John  Ranking,  an  English  merchant,  when  examined 
by  the  Select  Committee  of  the  House  of  Commons  in 
1813,  said  that  he  looked  upon  these  duties  as  "  pro- 
tecting "  duties,  to  "  encourage  our  own  manufactures." 

The  real  object  of  the  Parliamentary  Enquiry  in 
1813  was  to  promote  the  interests  of  the  manufacturers 
of  England.  This  is  evident  from  the  nature  of  the 
questions  that  were  put  to  the  witnesses  that  were 
examined  then  as  also  in  1831.  For  instance  War- 
ren Hastings  was  asked :  "  From  your  knowledge  of 
the  Indian  character  and  habits,  are  you  able  to  speak 
to  the  probability  of  a  demand  for  European  commo- 
dities by  the  population  of  India,  for  their  own  use?  " 

Similar  questions  were  asked  Sir  John  Malcolm  and    / 
other  witnesses,  among  them  Sir  Thomas  Munro,  who  -^ 
in  reply  to  a  question  whether  the  civilisation  of  the 
Hindus  could  not  be  improved  by  the  establishment  of 
an  open  trade  said :  y 

"  I  do  not  understand  what  is  meant  by  the  civilisa- 
tion of  the  Hindus ;  in  the  higher  branches  of  science, 
in  the  knowledge  of  the  theory  and  practice  of  good 
government,  and  in  education  which,  by  banishing 
prejudice  and  superstition,  opens  the  mind  to  receive  in- 
struction of  every  kind  from  every  quarter,  they  are 
much  inferior  to  Europeans.  But  if  a  good  system  of 
agriculture,  unrivalled  manufacturing  skill,  a  capacity 
to  produce  whatever  can  contribute  to  convenience  or 
luxury;  schools  established  in  every  village  for  teach- 


132  ENGLAND'S  DEBT  TO  INDIA 

ing  reading,  writing  and  arithmetic ;  the  general  prac- 
tice of  hospitality  and  charity  amongst  each  other ;  and 
above  all,  a  treatment  of  the  female  sex  full  of  con- 
fidence, respect  and  delicacy,  are  among  the  signs  which 
denote  a  civiHsed  people,  then  the  Hindus  are  not  in- 
ferior to  the  nations  of  Europe ;  and  if  civilisation  is  to 
become  an  article  of  trade  between  the  two  countries, 
I  am  convinced  that  this  country  (England)  will  gain 
by  the  import  cargo."  ^ 

In  less  than  seventy-five  years  (from  1757  to  1829) 
India  was  reduced  from  the  position  of  a  manufactur- 
ing country  to  that  of  a  supplier  of  raw  materials.  By 
1830  the  English  people  had  begun  "  to  look  to  India 
for  the  means  of  rendering  Great  Britain  independent 
of  foreign  countries  for  a  considerable  portion  of  raw 
material  upon  which  her  most  valuable  manufactures 
depend.  .  .  ."  ^  By  this  time  the  Manchester  school 
of  free  traders  had  come  into  prominence  who  in  the 
interests  of  English  industrial  workmen  were  anxious 
to  have  cheap  food  for  them  imported  in  exchange  for 
the  products  of  their  manufactures,  which  had  by  then 
been  well  established.  Cobden  and  Bright  could  not 
under  the  circumstances  be  expected  to  give  a  thought 
to  the  devastation  of  Indian  industries,  but  what  es- 
caped their  notice  was  observed  by  a  German  econo- 
mist (quoted  by  Dutt)  *  as  far  back  as  i866.  He 
wrote : 

"  Had  they  sanctioned  the  free  importation  into  Eng- 
land of  Indian  cotton  and  silk  goods,  the  English  cotton 
and  silk  manufacturers  must,  of  necessity,  soon  come 
to   a   stand.     India   had   not   only   the   advantage   of 

^       2  "  Minutes  of  Evidence,  &c.,  on  the  Affairs  of  the  East  India 

_     Company"  (1813),  pp.  124,  127,  131. 

8  Sir  John  Malcolm,  Governor  of  Bombay  in  1830, 
4  Dutt :  "  India  Under  Early  British  Rule,"  p.  300. 


THE  COTTON  INDUSTRY  OF  INDIA      133 

cheaper  labour  and  raw  material,  but  also  the  expe- 
rience, the  skill  and  the  practice  of  centuries.  The  ef- 
fect of  these  advantages  could  not  fail  to  tell  under  a 
system  of  free  competition. 

"  But  England  was  unwilling  to  found  settlements 
in  Asia  in  order  to  become  subservient  to  India  in  man- 
ufacturing industry.  She  strove  for  commercial  su- 
premacy, and  felt  that  of  two  countries  maintaining 
free  trade  between  one  another,  that  one  would  be 
supreme  which  sold  manufactured  goods,  while  that 
one  would  be  subservient  which  could  only  sell  agri-  . 
cultural  produce.  In  the  North  American  colonies,  ^ 
England  had  already  acted  on  those  principles  in  dis- 
allowing the  manufacture  in  those  colonies  of  even  a 
single  horse-shoe  nail,  and  still  more,  that  no  horse- 
shoe nails  made  there  should  be  imported  into  England.  -— - 
How  could  it  be  expected  of  her  that  she  would  give  up 
her  own  market  for  manufactures,  the  basis  of  her 
future  greatness,  to  a  people  so  numerous,  so  thrifty, 
so  experienced,  and  so  perfect  in  the  old  systems  of 
manufacture  as  the  Hindus? 

"  Accordingly,  England  prohibited  the  import  of  the 
goods  dealt  in  by  her  own  factories,  the  Indian  cotton 
and  silk  fabrics.  The  prohibition  was  complete  and 
peremptory.  Not  so  much  as  a  thread  of  them  would 
England  permit  to  be  used.  She  would  have  none  of 
these  beautiful  and  cheap  fabrics,  but  preferred  to  con- 
sume her  own  inferior  and  more  costly  stuffs.  She 
was,  however,  quite  willing  to  supply  the  Continental 
nations  with  the  far  finer  fabrics  of  India  at  lower 
prices,  and  willingly  yielded  to  them  all  the  benefit  of 
that  cheapness ;  she  herself  would  have  none  of  it."  ^ 

5  The  reader  might  also  read  the  statement  of  Henry  St. 
John  Tucker,  a  British  administrator  on  the  panel  in  "  Memor- 
ials of  the  Indian  Government,"  being  a  selection  from  the 
papers  of  Henry  St.  John  Tucker  (London,  1883),  p.  494,  and 
also  that  of  the  historian  H.  H.  Wilson  in  "  Mill's  History  of 
British  India,"  Wilson's  Book  I,  Chapter  VIII,  note. 


134  ENGLAND'S  DEBT  TO  INDIA 

In  1840  the  East  India  Company,  who  had  now 
ceased  to  be  directly  interested  in  Indian  trade,  in  their 
new  character  of  adminirtrator  pure  and  simple,  re- 
sponsible for  the  good  of  the  people  of  India,  pre- 
sented a  petition  to  Parliament  for  the  removal  of 
invidious  duties  which  discouraged  and  repressed  In- 
dian industries.  A  Select  Committee  of  the  House 
of  Commons  was  appointed.  One  of  the  witnesses  ex- 
amined was  a  certain  Mr.  J.  C.  Melvill.  We  take  the 
following  questions  and  answers  from  his  evidence : 

"  Have  native  manufactures  been  superseded  by 
British?  "  Melvill  was  asked. 

"  Yes,  in  great  measure,"  was  his  reply. 

"  Since  what  period  ?  " 

"  I  think  principally  since  1814." 

"  The  displacement  of  Indian  manufactures  by  Brit- 
ish is  such  that  India  is  now  dependent  mainly  for  its 
supply  of  those  articles  on  British  manufacturers?" 

"  I  think  so." 

"  Has  the  displacement  of  the  labour  of  native  man- 
ufacturers at  all  been  compensated  by  any  increase  in 
the  produce  of  articles  of  the  first  necessity,  raw 
produce? " 

"  The  export  of  raw  produce  from  India  has  in- 
creased since  she  ceased  largely  to  export  manufac- 
tures; but  I  am  not  prepared  to  say  in  what  propor- 
tion." « 

Mr.  Andrew  Sym  said  that  "  the  people  of  India  de- 
prived of  their  occupations,"  by  the  displacement  of 
Indian  labour  by  the  introduction  of  English  manu- 
factures —  clothing,  tools,  implements,  glassware,  and 
brass  articles,  turned  "  to  agriculture  chiefly." 

«  Questions  577,  578,  583,  584. 


THE  COTTON  INDUSTRY  OF  INDIA       135 

Testimony  of  G.  G.  de  H.  Larpent,  and  other  Brit- 
ishers. Mr.  Larpent  supplied  the  Committee  with  the 
following  figures  relating  to  the  import  of  Indian  cot- 
ton goods  into  England,  and  the  export  of  English 
cotton  goods  into  India. 

Cotton  Piece  Goods  Imported  into  Great  Britain  from 
the  East  Indies. 

1814  1,266,608  pieces 

1821  534,495      " 

1828  422,504      " 

1835  306,086      " 

British  Cotton  Manufactures  Exported  to  India. 

1814  818,208  yards 

1821  19,138,726      " 

1828  42,822,077      " 

1835  5^777,277      " 

In  spite  of  this  decline  in  the  Indian  manufacture, 
and  the  increase  of  British  manufacture,  British  cotton 
goods  were  still  imported  into  India  on  payment  of  an 
ad  valorem  duty  of  33^2  per  cent,  while  Indian  cotton 
goods  imported  into  England  were  subjected  to  an  ad 
valorem  duty  of  10  per  cent.  Quoting  from  Mr.  Shore, 
witness  read :  "  This  supersession  of  the  native  for 
British  manufactures  is  often  quoted  as  a  splendid  in- 
stance of  the  triumph  of  British  skill.  It  is  a  much 
stronger  instance  of  English  tyranny,  and  how  India 
has  been  impoverished  by  the  most  vexatious  system  of 
customs  and  duties  imposed  for  the  avowed  object  of 
favouring  the  mother  country."  Mr.  Larpent  did  not 
agree  with  Mr.  Shore  in  these  observations  to  the  full 
extent;  but  they  showed  the  feeling  of  a  distinguished 
servant  of  the  Company,  a  feeling  which  was  likely  to 
prevail  among  the  people  of  India, 

Silk  Goods.  British  silk  goods  were  admitted  into 
Calcutta  on  payment  of  a  duty  of  3^  per  cent.  Indian 


136  ENGLAND'S  DEBT  TO  INDIA 

silk  goods  were  subjected  to  an  import  duty  of  20  per 
cent,  in  England.  Corahs  or  Indian  silk  piece  goods 
in  the  grey  (unprinted),  were  imported  into  England 
mainly  for  being  printed  in  England  and  then  exported 
to  other  European  countries.  The  following  figures 
were  given  for  Corahs  imported  into  England : 

For  Home 

Consutjiption  For  Re-export 
Pieces  Pieces 

1838  16,000     ,  310,000 

1839 38,000  352,000 

Bandannas  or  Indian  printed  pocket-handkerchiefs 
were  imported  into  England  in  considerable  quantities. 
Mr.  Larpent  pleaded  strongly  for  the  equalisation  of 
duties  between  Great  Britain  and  India  with  regard  to 
silk  goods.  Mr.  Brocklehurst,  one  of  the  members  of 
the  Select  Committee,  represented  British  silk  manu- 
factures, and  necessarily  desired  the  continuance  of  un- 
equal duties  to  the  advantage  of  England. 

Mr.  Brocklehurst. — You  give  your  opinion  without 
reference  to  the  effect  it  would  have  on  the  British  pro- 
ducer? 

Mr.  Larpent. — I  have  no  doubt  there  would  be,  to  a 
certain  extent,  a  rivalry  in  competition  with  the  silk 
manufactures  of  this  country;  but  I  submit  on  principle 
that  India  ought  to  be  admitted  as  one  of  our  own  pos- 
sessions. The  argument  has  been  used  that  while  our 
manufactures  are  allowed  to  go  into  India  at  a  very 
reduced  duty,  we  ought  to  have  admitted  theirs  on  as 
low  a  duty. 

Mr.  Brocklehurst. — Is  there  any  colony  of  this  coun- 
try whose  manufactures  are  admitted  on  so  low  a  scale 
as  those  of  India? 

Mr.  Larpent. — There  is  no  colony  of  this  country 
whose  manufacturers  are  of  a  magnitude  calling  for  it. 
We  have  destroyed  the  manufactures  of  India.  (And 
then  the  witness  quoted  the  views  of  the  Court  of  Di- 
rectors, stated  in  Lord  William  Bentinck's  minute  of 


THE  COTTON  INDUSTRY  OF  INDIA       137 

May  30,  1829 :  "  The  sympathy  of  the  Court  is  deeply 
excited  by  the  report  of  the  Board  of  Trade,  exhibiting 
the  gloomy  picture  of  the  effects  of  a  commercial  revo- 
lution productive  of  so  much  present  suffering  to  nu- 
merous classes  in  India,  and  hardly  to  be  paralleled  in 
the  history  of  commerce.") 

But  Mr.  Brocklehurst  was  not  convinced.  He  re- 
turned again  and  again  to  the  subject. 

Mr.  Brocklehurst. — Are  you  aware  that  they  have 
already  so  far  displaced  silk  handkerchiefs  made  in  this 
country,  that  attempts  are  now  made  to  introduce  a 
spurious  article  from  waste  silk  as  a  substitute  ? 

Mr.  Larpent. — I  have  heard  that  an  article  is  intro- 
duced made  of  waste  silk ;  and  that  as  I  stated  before, 
the  ingenuity  and  science  of  the  parties  who  are  making 
those  goods,  will  probably  introduce  into  the  home  mar- 
ket a  quantity  of  goods  at  a  low  price,  which  will  be  in 
very  general  use. 

Mr.  Brocklehurst. — Driving  the  British  manufac- 
turer to  make  inferior  articles  to  maintain  his  ground  in 
competition  ? 

Mr.  Larpent. — The  articles  alluded  to  are  those  made 
here;  the  British  manufacturers  have  made  those  in- 
ferior articles. 

Mr.  Brocklehurst. — It  would  be  more  desirable  per- 
haps that  India  should  produce  the  raw  material,  and 
this  country  show  its  skill  in  perfecting  that  raw  ma- 
terial ? 

Mr.  Larpent. — The  course  of  things  in  India  is  de- 
cidedly leading  to  that ;  and  it  is  in  the  main  articles 
such  as  we  have  already  alluded  to,  that  we  do  think 
every  assistance  should  be  given  to  the  agricultural 
produce  of  India;  but  I  submit  that  as  this  is  the  last 
of  the  expiring  manufactures  of  India,  the  only  one 
where  there  is  a  chance  of  introducing  the  native  man- 
ufactures, at  least  let  it  have  a  fair  chance,  and  not 
be  oppressed  with  the  duty  of  20  per  cent.,  in  favour 
of  the  British  manufactures. 


138  ENGLAND'S  DEBT  TO  INDIA 

Testimony  of  Montgomery  Martin. 

"  1  have  examined  at  considerable  length,  and 
for  a  series  of  years,  the  trade  of  India.  I  have 
taken  the  utmost  pains  to  arrive  at  correct  conclusions 
by  examining  various  documents  which  the  Honour- 
able Court  of  Directors  of  the  East  India  House,  with 
their  usual  liberality,  permitted  me  access  to.  And  I 
have  been  impressed  with  the  conviction  that  India  has 
suffered  most  unjustly  in  her  trade,  not  merely  with 
England  but  with  all  other  countries,  by  reason  of  the 
outcry  for  free  trade  on  the  part  of  England  without 
permitting  to  India  a  free  trade  herself."  And  he 
added  that,  "  on  all  articles  except  those  where  we  are 
supplanting  the  native  manufacturers,  and  consequently 
impoverishing  the  country,  there  is  a  decreasing  trade." 

Cotton  Goods.  In  1815  the  cotton  goods  exported 
from  India  were  of  the  value  of  £1,300,000.  In  1832 
they  were  less  than  £100,000.  In  181 5  the  cotton  goods 
imported  into  India  from  England  were  of  the  value  of 
£26,300.  In  1832  they  were  upwards  of  £400,000. 
"  We  have  during  the  period  of  a  quarter  of  a  century 
compelled  the  Indian  territories  to  receive  our  manu- 
factures ;  our  woollens,  duty  free,  our  cottons  at  23^ 
per  cent.,  and  other  articles  in  proportion ;  while  we 
have  continued  during  that  period  to  levy  almost  pro- 
hibitory duties,  or  duties  varying  from  10  to  20,  30,  50, 
100,  500,  and  1000  per  cent,  upon  articles,  the  produce 
from  our  territories.  Therefore  the  cry  that  has  taken 
place  for  free  trade  with  India,  has  been  a  free  trade 
from  this  country,  not  a  free  trade  between  India  and 
this  country.  .  .  .  The  decay  and  destruction  of  Surat, 
of  Dacca,  of  Murshedabad,  and  other  places  where  na- 
tive manufactures  have  been  carried  on,  is  too  painful  a 
fact  to  dwell  upon.  I  do  not  consider  that  it  has  been 
in  the  fair  course  of  trade  ;  I  think  it  has  been  the  power 
of  the  stronger  exercised  over  the  weaker." 

Evidence  such  as  this  brought  about  a  keen  contro- 


THE  COTTON  INDUSTRY  OF  INDIA      139 

versy  between  the  witness  and  Mr.  Brocklehurst,  the 
representative  of  the  British  manufacturer. 

Mr.  Brocklehurst, — The  fact  being  that  weavers, 
either  in  the  one  country  or  the  other,  must  be  sacri- 
ficed, and  that  sacrifice  having  already  taken  place  in 
India,  you  wish  to  revive  the  population  of  India  at  the 
expense  of  this  country? 

Mr.  Martin. — I  do  not  wish  to  revive  it,  but  I  wish  to 
prevent  continued  injury  to  India.  But  it  does  not  nec- 
essarily follow  that  the  weavers  of  England  would  be 
destroyed  by  admitting  the  natives  of  India  to  compete 
with  them  in  this  country,  because  the  natives  of  India 
have  no  power  looms,  and  no  means  of  employing  skill 
and  capital  to  the  extent  that  the  manufacturers  of 
Glasgow  and  Manchester  have. 

Mr.  Brocklehurst. — The  questions  that  have  been 
asked  refer  entirely  to  fine  fabrics  which  cannot  be 
woven  by  power.  The  question  is,  whether  we  are  to 
give  up  fine  weaving  in  this  country,  or  retain  it? 

Mr.  Martin. — If  it  is  only  to  be  retained  at  the  ex- 
pense of  injustice  to  India,  my  answer  is,  that  England 
ought  to  act  with  justice,  no  matter  what  the  result  may 
be.  That  she  has  no  right  to  destroy  the  people  of  a 
country  which  she  has  conquered,  for  the  benefit  of 
herself,  for  the  mere  sake  of  upholding  any  isolated 
portion  of  the  community  at  home. 

Mr.  Brocklehurst. — When  the  transfer  of  India  to 
the  Government  of  this  country  took  place  in  1833,  the 
destruction  of  weaving  in  India  had  already  taken  place, 
and  therefore  it  is  not  a  question  of  destruction,  for  that 
is  past ;  and  Vv^e  have  it  in  evidence  that  India  is  an 
agricultural  rather  than  a  manufacturing  country,  and 
that  the  parties  formerly  employed  in  manufactures  are 
now  absorbed  in  agriculture.  Does  it  occur  to  you 
that  there  is  an  opening  in  this  country,  if  manufactur- 
ers are  displaced,  for  the  people  to  turn  to  agriculture  ? 

Mr.  Martin. — I  do  not  agree  that  India  is  an  agri- 
cultural country;  India  is  as  much  a  manufacturing 


140  ENGLAND'S  DEBT  TO  INDIA 

country  as  an  agricultural;  and  he  who  would  seek  to 
reduce  her  to  the  position  of  an  agricultural  country 
seeks  to  lower  her  in  the  scale  of  civilisation.  I  do  not 
suppose  that  India  is  to  become  the  agricultural  farm  of 
England ;  she  is  a  manufacturing  country,  her  manu- 
factures of  various  descriptions  have  existed  for  ages, 
and  have  never  been  able  to  be  competed  with  by  any 
nation  wherever  fair  play  has  been  given  to  them.  I 
speak  not  now  of  her  Dacca  muslins  and  her  Cashmere 
shawls,  but  of  various  articles  which  she  has  manufac- 
tured in  a  manner  superior  to  any  part  of  the  world. 
To  reduce  her  now  to  an  agricultural  country  would  be 
an  injustice  to  India. 

Another  committee  with  John  Bright  as  chairman 
was  appointed  to  inquire  into  the  growth  of  cotton  in 
India.  The  evidence  given  before  this  committee  laid 
stress  on  the  necessity  of  land  assessments  being  re- 
duced to  put  heart  into  the  cultivator  and  also  on 
the  improvement  of  means  of  transportation.  Some 
members  also  spoke  of  the  economic  drain.  On  the 
condition  of  the  cultivators  of  Madras  and  Bombay 
the  committee  remarked  that  they  were  "  almost  wholly 
without  capital  or  any  of  those  means  which  capital 
alone  can  furnish  by  which  industry  may  be  improved 
and  extended.  They  are  in  reality  a  class  of  cultiva- 
tors in  the  most  abject  condition."  Their  other  recom- 
mendations are  not  relevant  to  this  part  of  our  subject. 
Duties  on  the  import  of  cotton  (raw)  into  England 
from  Bengal  had  been  abolished  in  1836,  those  on  Bom- 
bay cotton  in  1838  and  those  on  Madras  cotton  in 
1844. 


THE  COTTON  INDUSTRY  OF  INDIA       141 
II 

THE   HISTORY   OF   IMPORT   DUTIES   AND  THE   PRESENT 
STATE    OF    THE    INDUSTRY 

Legislative  Acts. —  Various  acts  were  passed  from 
time  to  time  between  1833  and  1853  by  the  Indian 
Legislature  to  regulate  trade  and  navigation  and  to 
fix  the  tariff.  We  have  already  stated  in  the  previous 
section  how  the  export  of  raw  cotton  was  freed  of  any 
duty  between  1836  and  1844.  In  1853  the  import 
duties  ranged  from  3^  per  cent,  to  5  per  cent,  ad 
valorem  except  in  the  case  of  foreign  (i.e.,  non-Brit- 
ish) cotton  and  silk  goods,  foreign  cotton  thread  and 
yarn  and  foreign  marine  stores  and  foreign  metals. 
These  foreign  goods  had  to  pay  double  duty.  These 
duties  were  imposed  for  revenue  purposes  and  not  for 
protection.  In  the  case  of  cotton  and  silk  manufac- 
tures there  was  no  question  of  protection  as  there  was 
no  industry  in  India  to  be  protected  and  later  when 
the  industry  did  come  into  existence,  the  duties  were 
more  than  once  remitted.  The  higher  duties  on  for- 
eign goods,  though,  were  a  sort  of  protection  to  British 
goods. 

In  1858  when  Queen  Victoria  assumed  the  direct 
sovereignty  of  the  Indian  Empire,  the  import  duties, 
as  before,  stood  at  33^  per  cent,  ad  valorem  upon 
cotton  twist  and  yarns  and  at  5  per  cent,  on  other 
articles  of  British  produce  and  manufacture,  including 
cotton  piece  goods.  The  duties  on  foreign  articles 
were  still  double.  In  1859,  on  account  of  the  heavy 
financial  pressure  after  the  Mutiny,  all  differential  tar- 
iffs were  abolished;  duties  on  all  articles  of  luxury 


142  ENGLAND'S  DEBT  TO  INDIA 

were  raised  to  20  per  cent,  ad  valorem;  duties  on  other 
articles,  including  cotton  piece  goods,  were  raised  to 
10  per  cent. ;  and  those  on  cotton  twist  and  yarn  to 
5  per  cent. 

In  i860,  only  a  year  later,  there  was  another  change 
in  favour  of  uniform  tariff  of  10  per  cent,  ad  valorem, 
with  special  rates  upon  beer,  wines,  spirits  and  to- 
bacco.'^ In  1861,  the  duty  on  cotton  twist  and  yarn 
was  reduced  to  5  per  cent.  In  1862  it  was  further  re- 
duced to  3}^  per  cent,  and  the  duty  on  cotton  and  other 
manufactures  was  reduced  to  5  per  cent.  In  1863 
the  duty  on  imported  iron  was  reduced  to  i  per  cent. 
In  1867  a  great  number  of  articles  were  added  to  the 
free  list.  In  1870  a  new  Tariff  Act  was  passed  which 
placed  the  import  duties  generally  at  7^  per  cent,  on 
manufactured  goods  and  raw  materials,  at  5  per  cent, 
on  piece  goods,  at  33/2  per  cent,  on  twist,  at  i  per  cent, 
on  iron  and  at  10  per  cent,  on  tobacco. 

The  law  was  again  changed  in  1871  but  the  altera- 
tions were  not  material. 

A  select  committee  of  the  House  of  Commons 
which  sat  from  1871  to  1874  took  evidence  on  the  oper- 
ation of  the  duties,  in  which  objection  was  made  to  the 
import  duty  on  cotton  piece  goods  and  to  the  export 
duty  on  grains.  At  that  time  there  were  only  two  or 
three  cotton  spinning  and  weaving  mills  in  Calcutta. 

Sir  Bartle  Frere  expressed  himself  in  favour  of 
keeping  down  the  import  duty  on  cotton  piece  goods  in 
order  to  foster  the  sale  of  British  goods.  He  con- 
fessed that  "  the  interests  of  India  and  England  on  that 
point  seemed  to  be  at  variance.     No  doubt  some  con- 

^  Export  duties  on  Indian  raw  produce  were  abolished. 


THE  COTTON  INDUSTRY  OF  INDIA       143 

siderable  increase  of  revenue  might  be  realised  by  in- 
creasing the  import  duties;  say  upon  piece  goods  and 
yarn,  but  the  direct  result  of  that  would  be  to  diminish 
consumption  and  to  stimulate  production  on  the  spot," 
which,  of  course,  he  and  his  countrymen  did  not  de- 
sire. 

Mr.  Walter  Cassels,  a  Bombay  merchant  who  had 
been  a  member  of  the  Bombay  Legislative  Council, 
agreed  that  even  the  small  import  duty  of  5  per  cent., 
on  cotton  piece  goods  operated  as  a  protective  duty, 
though  he  added  he  did  not  desire  its  abolition  on  that 
ground.  He  stated  that  at  that  time  there  were  twelve 
cotton  mills  in  Bombay  employing  319,394  spindles, 
4199  looms  and  8170  hands. 

A  glimpse  into  the  helplessness  of  the  Government 
of  India  in  the  matter  of  its  fiscal  policy  can  be  had  by 
a  study  of  questions  that  were  put  to  Lord  Lawrence 
by  Henry  Fawcett  and  the  answers  given  by  the 
former.  Lord  Lawrence  had  tried  to  raise  the  ex- 
port duties  on  jute  and  other  Indian  products  in  1865, 
to  get  a  little  additional  revenue  and  save  the  country 
from  a  deficit.  But  British  interests  had  been  too 
strong  for  him  and  the  Secretary  of  State  for  India 
had  disallowed  his  proposals.  Eight  years  after,  when 
he  was  questioned  by  Mr.  Fawcett,  he  guardedly  ex- 
pressed his  painful  impressions  of  the  influence  of 
British  trade  over  the  financial  policy  of  India.  The 
British  trade  interests  have  virtually  dominated  the 
fiscal  policy  of  the  India  Government  ever  since  Brit- 
ish occupation  of  India,  and  they  do  so  to  this  day. 

In  1874,  the  Lancashire  manufacturers,  by  a  me- 
morial addressed  to  the  Secretary  of  State  for  India, 


144  ENGLAND'S  DEBT  TO  INDIA 

started  their  attack  on  the  5  per  cent,  and  3}4  per  cent, 
duties  on  cotton  piece  goods  and  cotton  twist  respec- 
tively, representing  them  as  protective  duties.  The 
complaint  was  that  on  account  of  the  duties  a  protected 
trade  in  cotton  manufacture  was  springing  up  in  Brit- 
ish India  to  the  disadvantage  of  both  India  and  Great 
Britain.  The  reference  to  India  is  very  amusing. 
The  interests  of  India  and  of  the  poor  people  of  In- 
dia have  always  been  present  before  the  mind  of  the 
English  merchant  and  his  protector, —  the  Secretary 
of  State  for  India.  We  shall  find  it  referred  to,  in 
feeling  terms  almost  every  time  a  mandate  has  had 
to  be  issued  to  the  Government  of  India  for  the  fur- 
therance of  the  interests  of  British  trade,  so  often  that 
we  are  afraid  the  reader  might  be  disgusted  by  its  con- 
stant reiteration  and  repetition  in  documents  so  pal- 
pably harmful  to  Indian  interests. 

The  reply  of  the  Secretary  of  State  to  this  memo- 
rial being  rather  evasive  on  the  main  points  raised  by 
the  memorialists,  they  found  it  necessary  to  state  in 
so  many  words  that  what  they  objected  to  was  the 
opening  of  new  mills  in  India.     They  said : 

"  The  statements  as  to  the  harmful  operation  of 
these  duties  on  commerce,  and  on  the  best  interests 
of  her  majesty's  subjects,  both  in  India  ( !!)  and  Eng- 
land are  abundantly  confirmed  by  the  latest  advices 
from  Bombay,  which  show  that,  under  protection  ex- 
tended by  the  levying  of  duties  on  imports,  to  the 
spinning  and  weaving  of  cotton  yarns  and  goods  in 
India,  a  large  number  of  new  mills  are  now  being  pro- 
jected.^ 

*  Quoted  by  Dutt  from  Government  of  India  Resolution  No. 


THE  COTTON  INDUSTRY  OF  INDIA       145 

On  this,  the  Government  of  India  appointed  a  com- 
mittee to  consider  the  question.  All  the  members,  we 
are  told  by  Dutt,  were  English  merchants  and  officials. 
Yet  the  committee  was  unanimous  in  rejecting  the 
Manchester  demand  for  the  repeal  of  import  duties  on 
cotton  yarns  and  goods. 

Lord  Northbrook,  then  Viceroy  of  India,  a  free- 
trader, refused  to  sacrifice  a  source  of  revenue  which 
in  his  opinion  did  not  operate  as  protection.  A  new 
Tariff  Act  was  passed  which  retained  the  import  duties 
on  cotton  yarn  and  goods ;  largely  reduced  valuation ; 
and  imposed  a  5  per  cent,  duty  on  the  import  of  long 
staple  cotton  "  to  prevent  Indian  Mills  competing  at  an 
advantage  in  the  production  of  the  finer  goods."  ^ 
They  also  abolished  all  export  duties  except  on  indigo, 
rice  and  lac,  reduced  the  general  rate  of  import  duties 
to  5  per  cent,  and  raised  the  duties  on  spirits  and  wines. 
This  resulted  in  a  total  loss  of  £308,000  to  the  Indian 
revenues.  Meanwhile  by  the  turn  of  the  political 
wheel  in  England,  the  Conservative  party  had  come 
into  power  and  Lord  Salisbury  had  been  appointed 
Secretary  of  State  for  India,  in  the  administration  of 
Disraeli.     In  July,  1875,  he  wrote  to  the  Viceroy: 

"  If  it  were  true  that  this  duty  is  the  means  of  ex- 
cluding English  competition,  and  thereby  raising  the 
price  of  a  necessary  of  life  to  the  vast  mass  of  Indian 
consumers,  it  is  unnecessary  for  me  to  remark  that  it 
would  be  open  to  economical  objections  of  the  gravest 
kind.  I  do  not  attribute  to  it  any  such  effect;  but  I 
cannot  be  insensible  to  the  political  evils  which  arise 
from  the  prevalent  belief  upon  the  matter. 

2636  of  August  12,  1875,  forming  an  enclosure  to  Despatch  No. 
15  of  1875.     The  italics  are  ours. 
8  Dutt,  "  India  in  the  Victorian  Age,"  p.  404. 


146  ENGLAND'S  DEBT  TO  INDIA 

"  These  considerations  will,  I  doubt  not,  commend  to 
your  Excellency's  mind  the  policy  of  removing,  at  as 
early  a  period  as  the  state  of  your  finances  permits,  this 
subject  of  dangerous  contention." 

Lord  Northbrook  replied  by  cable  that  the  Bill  had 
been  passed,  giving  the  substance  of  its  provisions. 
Lord  Salisbury  wired  back  his  dissatisfaction  and  ob- 
jections. 

The  dispute  between  Lord  Salisbury  and  Lord 
Northbrook  raised  a  question  of  principle,  viz.,  the 
competency  of  the  Governor  General  in  Council  to  pass 
any  important  measure  without  obtaining  the  previous 
sanction  of  the  Secretary  of  State  for  India.  Finding 
himself  unable  to  accept  this  principle.  Lord  North- 
brook resigned  his  office.  His  resignation  was  ac- 
cepted, and  Lord  Lytton  appointed  in  his  place.  After 
this  affair,  Lord  Salisbury  laid  down  the  principle  in 
black  and  white,  in  a  despatch  to  the  Viceroy  —  a  view 
from  which  two  of  his  counsellors  dissented.  Ever 
since,  the  Government  of  India  has  been  in  theory  as 
well  as  fact  "  a  government  by  mandate." 

With  Lord  Lytton  succeeding  Lord  Northbrook  to 
the  Viceroyalty  of  India,  the  path  of  Lord  Salisbury 
became  smoother.  He  at  once  ordered  the  repeal  of 
the  import  duty  on  cotton  goods  in  spite  of  the  dissent 
of  three  members  of  his  council. 

Lord  Lytton,  though  quite  willing  to  do  the  bidding 
of  the  Secretary  of  State,  found  that  in  the  meantime 
the  terrible  famine  of  Madras  had  affected  the  finan- 
cial situation  of  India  so  seriously  that  even  he  could 
not  sacrifice  this  item  of  revenue  immediately.  So, 
with  the  concurrence  of  the  Secretary  of  State,  the 


THE  COTTON  INDUSTRY  OF  INDIA      147 

import  duties  had  to  be  continued  for  two  years  longer. 
But  the  manufacturers  of  Lancashire  were  losing 
patience.     The  question  was  raised  in  the  House  of 
Commons  and  that  august  body  resolved : 

"  That,  in  the  opinion  of  this  House,  the  duties  now 
levied  upon  cotton  manufactures  imported  into  India, 
being  protective  in  their  nature,  are  contrary  to  sound 
commercial  policy,  and  ought  to  be  repealed  without 
delay,  so  soon  as  the  financial  condition  of  India  will 
permit." 

Lord  Salisbury  forwarded  the  Resolution  to  the 
Government  of  India  and  referred  to  the  fact  "  that 
five  more  mills  were  about  to  begin  work ;  and  that  it 
was  estimated  that  by  the  end  of  March,  1877,  there 
would  be  1,231,284  spindles  employed  in  India."  (Let- 
ter to  the  Governor  General  in  Council  of  August  30, 

1877.) 

So  in  the  coming  year,  the  Government  of  India 
began  by  exempting  from  duty  certain  kinds  of 
imported  goods  with  a  calculated  loss  of  £22,227 
to  the  Indian  revenue.  Lancashire  was  not  satisfied 
and  pressure  was  brought  to  bear  upon  the  Govern- 
ment of  India  to  repeal  the  duties  on  cotton  imports 
altogether.  The  Council  of  the  Governor  General, 
however,  was  not  unanimous  on  the  point  and  the 
minutes  of  the  dissenting  members  speak  for  them- 
selves. 

Mr.  Whitley  Stokes'  first  objection  was  in  the  inter- 
ests of  Indian  finance : 

"We  have  spent  our  Famine  Insurance  Fund,  or 
what  was  intended  to  be  such.  We  are  carrying  on  a 
costly  war  with  Afghanistan.     We  may  any  day  have 


148  ENGLAND'S  DEBT  TO  INDIA 

to  begin  one  with  the  King  of  Burma.  We  have  now 
to  borrow  five  crores  (five  millions  sterling)  in  India, 
and  we  are  begging  for  two  millions  sterling  from  Eng- 
land. 

"Secondly,  because  the  proposed  surrender  would 
eventually  lead  to  the  surrender  of  the  import  duty  on 
all  cotton  goods.  *  The  powerful  Lancashire  manu- 
facturers will  be  encouraged  by  their  second  victory  to 
new  attacks  on  our  revenue.  ...  If  ever  we  have  any 
true  surplus,  we  should,  in  my  opinion,  lessen  some  of 
our  direct  taxes  rather  than  abohsh  any  of  our  moder- 
ate import  duties.' 

"  Fifthly,  because,  by  the  proposed  repeal,  *  the  Man- 
chester manufacturers  would  practically  compel  the 
people  of  India  to  buy  cotton  cloths  adulterated,  if  pos- 
sible, more  shamefully  than  such  goods  are  at  present. 
The  cost  of  the  clothing  of  the  people  would  thus  be  in- 
creased rather  than  lessened.' 

"Sixthly,  because  Indian  newspapers  will  proclaim 
in  every  bazaar  that  the  repeal  was  made  *  solely  in  the 
interest  of  Manchester,  and  for  the  benefit  of  the  Con- 
servative party,  who  are,  it  is  alleged,  anxious  to  ob- 
tain the  Lancashire  vote  at  the  coming  elections.'  Of 
course  the  people  of  India  will  be  wrong;  they  always 
must  be  wrong  when  they  impute  selfish  motives  to  the 
ruling  race."  ^^ 

Among  other  objections  he  also  pointed  out  that  the 
repeal  was  demanded  by  the  manufacturers  of  Lan- 
cashire and  not  by  the  people  of  India. 

Sir  Alexander  Arbuthnot  pointed  out  that 

"  The  people  of  India  attribute  the  action  which  has 
been  taken  by  her  Majesty's  Government  in  this  matter 
to  the  influences  which  have  been  brought  to  bear  upon 
it  by  persons  interested  in  the  English  cotton  trade ;  in 

10  The  italics  are  ours. 


THE  COTTON  INDUSTRY  OF  INDIA       149 

other  words  by  the  manufacturers  of  Lancashire.  It  is 
notorious  that  this  impression  has  prevailed  throughout 
India  from  the  time,  just  four  years  ago,  when  the  Mar- 
quis of  Sahsbury  informed  a  large  body  of  Manchester 
manufacturers  that  the  Government  of  India  would  be 
instructed  to  provide  for  the  gradual  abolition  of  the 
import  duties  on  cotton  goods. 

"  Nor  is  this  feeling  limited  to  the  Native  community. 
From  communications  which  have  been  received  from 
the  Chambers  of  Commerce  at  Madras  and  Calcutta,  it 
is  evident  that  the  feeling  is  shared  by  the  leading  rep- 
resentatives of  the  European  mercantile  community  in 
those  cities. 

"  It  is  equally  shared  by  the  great  body  of  the  official 
hierarchy  throughout  India.  I  am  convinced  I  do  not 
overstate  the  case  when  I  affirm  my  belief  that  there  are 
not  at  the  present  time  a  dozen  officials  in  India  who  do 
not  regard  the  policy  which  has  been  adopted  in  this 
matter  as  a  policy  which  has  been  adopted,  not  in  the 
interests  of  India,  not  even  in  the  interests  of  England, 
but  in  the  interests  or  the  supposed  interests  of  a  politi- 
cal party,  the  leaders  of  which  deem  it  necessary  at  any 
cost  to  retain  the  political  support  of  the  cotton  manu- 
facturers of  Lancashire."     [The  italics  are  ours.] 

Similar  protests  were  made  by  Mr.  Rivers  Thom- 
son (afterwards  Lieutenant  Governor  of  Bengal)  and 
Sir  Andrew  Clarke.  Against  all  these  protests,  and  in 
defiance  of  the  opinion  of  the  majority  of  his  Council, 
Lord  Lytton,  with  the  concurrence  of  Sir  John 
Strachey  and  Sir  Edwin  Johnson,  exempted  from  im- 
port duty  "  all  imported  cotton  goods  containing  no 
yarn  finer  than  30's."  The  Secretary  of  State  of 
course  approved  of  the  act  of  Lord  Lytton,  though 
seven  members  of  his  own  Council,  including  Sir  Fred- 
eric Halliday,  Sir  Robert  Montgomery,  Sir  William 
Muir,  and  Sir  Erskine  Perry,  dissented. 


150         ENGLAND'S  DEBT  TO  INDIA 

This  shows  conclusively  how  even  the  Anglo-Indian 
Administrator  is  helpless  to  protect  Indian  interests, 
when  the  latter  clash  w^ith  the  financial  interests  of 
Great  Britain. 

The  question  of  cotton  duties  has  been  one  of  the 
most  exciting  questions  that  have  exercised  the  public 
mind  in  India  for  the  last  fifty  years.  It  is  one  of 
those  few  questions  on  which  the  Indians  and  the  resi- 
dent Anglo-Indians  hold  exactly  the  same  views.  It 
affects  an  industry,  in  the  prosperity  of  which  the  In- 
dian and  the  resident  Anglo-Indian  mill  owners  are 
equally  interested.  To  proceed  with  the  story,  the 
tariffs  were  again  tampered  with  during  the  viceroy- 
alty  of  Lord  Ripon,  with  the  result  that  in  March, 
1882,  the  remaining  import  duties  w-ere  also  abolished, 
excepting  those  on  salt  and  liquors. 

For  the  next  twelve  years  the  matter  remained  at 
rest,  until  the  financial  embarrassments  of  the  Govern- 
ment of  India  forced  the  latter  to  reopen  the  question 
in  1894,  when  the  Indian  Government  had  to  face  a 
deficit  of  more  than  two  million  pounds  sterling. 

A  committee,  called  Lord  Herschell's  Committee, 
was  appointed,  which  recommended  the  re-imposition 
of  import  duties  except  on  cotton  goods.  When  a  tar- 
iff bill  was  brought  before  the  Council,  on  the  lines  of 
the  recommendations  of  the  Committee,  it  met  with 
strong  opposition  from  the  non-official  members  of  the 
Council  on  the  ground  that  it  exempted  a  class  of  goods 
which  should  pre-eminently  bear  an  import  duty  and  a 
duty  that  would  yield  the  best  results,  as  "  the  volume 
of  trade  in  cotton  goods  and  yarns  then  represented 
nearly  one-half  of  the  total  imports  from  abroad."    It 


THE  COTTON  INDUSTRY  OF  INDIA      151 

was  argued  that  "  the  exemption  of  these  important 
commodities  when  practically  every  single  commodity 
was  being  subjected  to  an  import  duty  could  not  be 
justified  on  its  merits  as  a  sound  fiscal  measure  much 
less  when  it  was  an  admitted  fact  that  the  Budget 
would  still  show  a  deficit."  ^^  The  Government  of  In- 
dia, however,  could  not  accept  these  views,  as  they  had 
a  mandate  from  the  Secretary  of  State  for  India  which 
they  dared  not  ignore.  This  Act  was  thus  passed  in 
the  teeth  of  the  strong  and  united  opposition  of  the  In- 
dians and  the  Anglo-Indians,  in  March,  1894,  but  in 
December,  1894,  the  subject  was  re-opened  under  in- 
structions from  the  Secretary  of  State  who  in  the 
meantime  found  out  another  way  of  propitiating  Lan- 
cashire without  sacrificing  revenue  —  viz.,  by  imposing 
a  counteracting  excise  duty  upon  yarns  produced  in 
Indian  mills,  which  could  possibly  compete  with  Lan- 
cashire yarn.  Accordingly  two  bills  were  introduced 
in  the  Legislative  Councils,  the  first  of  which  subjected 
cotton  yarn  and  fabrics  to  the  general  import  duty  of 
5  per  cent  ad  valorem  and  the  second  imposed  an  ex- 
cise duty  on  all  cotton  yarns  of  20's  and  above  pro- 
duced by  Indian  mills.  In  introducing  this  latter  bill, 
the  then  Finance  Minister,  Sir  James  Westland,  stated 
in  the  Council  that  the  policy  underlying  its  provisions 
had  been  imposed  on  the  Governments  of  India  by 
the  Secretary  of  State  in  pursuance  of  the  resolutions 
of  the  House  of  Commons  passed  in  1877  and  1879. 
The  law,  however,  satisfied  nobody.  The  Indian  mill 
owners   were   of   course   dissatisfied  with   the  whole 

11  The  Indian  Year  Book  issued  by  the  Times  of  India  Press 
for  191S,  p.  234. 


152  ENGLAND'S  DEBT  TO  INDIA 

policy  but  they  also  added  another  objection  and 
pointed  out  how  impossible  it  was  to  spin  precisely  to  a 
particular  count.  Lancashire  on  the  other  hand  con- 
tended that  the  bill  left  loopholes  for  evasion.  Con- 
sequently the  matter  was  reconsidered  in  1895  and 
another  Act  (II  of  1896)  was  passed  by  which  yarn 
was  altogether  exempted  from  duty  and  a  uniform 
duty  of  3^  per  cent,  was  imposed  on  all  woven  goods 
whether  imported  or  manufactured  in  India.  The 
measure  was  of  course  opposed  by  both  Indian  and 
Anglo-Indian  non-official  members.  Mr.  Stevens, 
afterwards  Sir  Charles  Stevens,  representing  the  Ben- 
gal Chamber  of  Commerce,  said : 

"  I  fear  it  must  be  owned  that  the  measure  has  not 
received  the  support  of  the  public  as  a  whole.  For 
this  there  are  two  main  reasons.  First,  the  suspicion 
existing  in  some  quarters  that  it  has  been  called  for 
by  the  exigencies  of  party  politics  in  England  rather 
than  by  the  wants  of  India ;  secondly,  that  the  trade 
will  be  disturbed  to  the  disadvantage  of  important  in- 
dustries and  of  poor  consumers  in  this  country." 

What  has  happened  since  then  may  be  stated  in  the 
words  of  the  writer  of  the  article  on  this  subject  in 
the  Indian  Year  Book  of  1915  : 

"  New  Factors  in  the  Situation.  Since  the  passing 
of  this  measure  into  law  the  policy  of  the  Government 
of  India  in  this  respect  has  frequently  been  the  subject 
of  attack  in  the  press  and  in  the  Legislative  Councils 
while  it  has  also  formed  the  subject  of  continued  repre- 
sentations by  the  industrial  interests  affected  and  po- 
litical organisations.  In  more  recent  years  the  agita- 
tion in  favour  of  the  abolition  of  the  Excise  duties  has 
been  revived  by  the  growth  in  England  of  a  strong 


THE  COTTON  INDUSTRY  OF  INDIA      153 

body  of  public  opinion  in  opposition  to  the  policy  of 
Free  Trade.  Advantage  has  been  taken  of  this  new 
phase  in  English  economic  thought  to  press  on  behalf 
of  India  the  acceptance  of  a  policy  of  Protection,  and 
the  removal  of  the  Excise  duties  is  now  claimed  by  the 
opponents  to  this  measure  as  a  necessary  corollary  of 
the  application  to  the  British  Empire  of  the  principles 
associated  with  the  name  of  Mr.  Chamberlain.  A  new 
factor  in  the  situation  which  has  strengthened  the  posi- 
tion of  those  who  are  in  opposition  to  the  Excise  duties 
is  to  be  found  in  the  severe  competition  which  Indian 
mills  have  to  face  in  China  as  well  as  in  India  from  the 
Japanese  industry.  The  Japanese  market  was  lost  to 
India  in  the  early  years  of  this  century.  More  recently, 
however,  Japan  has  entered  as  a  competitor  with  India 
into  the  China  market,  while  within  the  last  few  years  it 
has  pushed  its  advantage  as  against  the  Indian  mill- 
owner  in  the  Indian  market  itself.  Again  it  is  claimed 
that  the  recent  enhancement  of  the  silver  duty  has  ma- 
terially affected  the  position  of  the  Indian  spinner  who 
relied  on  the  China  market.  On  two  occasions  within 
the  last  five  years  the  question  of  Excise  duties  has 
come  prominently  to  the  front  as  a  result  of  debates  in 
the  Viceroy's  Council.  The  official  attitude  is  firmly 
based  on  the  position  that  the  Excise  duties  stand  and 
fall  with  the  import  duties.  Against  such  an  attitude 
all  arguments  based  either  on  the  advantages  of  a  Pro- 
tectionist as  opposed  to  a  Free  Trade  policy  or  on  the 
handicap  to  which  the  present  system  exposes  the  In- 
dian millowner  can,  of  course,  make  no  headway.  The 
Government  of  India  are  confronted  with  a  heavy  re- 
curring loss  in  their  revenues  as  a  result  of  the  abolition 
of  the  opium  traffic.  The  import  duties  on  cotton 
piece-goods  represent  nearly  fifteen  per  cent,  of  the 
total  revenue  collected  as  Customs  duty  while  the  Ex- 
cise duty  itself  realised  no  less  than  47  lakhs  in  1912-13. 
The  strength  of  the  arguments  which  support  the  Gov- 
ernment position  is  so  patent  that  the  movement  in 
favour  of  the  total  abolition  of  the  Excise  duty  is  grad- 


154  ENGLAND'S  DEBT  TO  INDIA 

ually  giving  way  to  a  feeling  that  a  solution  may  be 
found  in  maintaining  the  Excise  duty  at  its  present 
rate  while  enhancing  the  import  duties  to  the  level  of 
the  general  rate  of  Customs  duty.  This  policy  which 
is  frankly  of  a  protective  character,  can  to  some  slight 
extent  be  supported  by  the  change  in  the  position  of 
Lancashire  in  respect  of  the  imports  of  cotton  piece- 
goods.  In  1894  when  the  duties  were  first  imposed  the 
share  of  Lancashire  was  no  less  than  98  per  cent,  of  the 
total  import  trade  in  piece-goods.  Foreign  competi- 
tion, notably  from  Japan  has  reduced  its  share  to  91  per 
cent,  and  it  may  be  expected  that  the  success  of  this  at- 
tack on  the  position  of  Lancashire  will  in  the  near 
future  loom  largely  in  the  arguments  of  those  who 
favour  a  modified  form  of  protection  within  the  Em- 
pire." 

In  spite  of  these  drawbacks  the  cotton  industry  re- 
ceived a  great  and  extraordinary  stimulus  by  the  Boy- 
cott and  Swadeshi  movements  started  by  the  Indian 
Nationalists  in  1905  as  a  protest  against  the  administra- 
tion of  Lord  Curzon ;  but  as  the  momentum  created 
by  the  movement  has  declined  by  the  force  of  time  and 
change  in  circumstances  the  rate  of  progress  in  the 
development  of  the  industry  has  also  gone  down. 

In  1904  there  were  191  mills  in  the  whole  of  British 
India,  working  5,118,121  spindles  and  45,337  looms. 
By  1909  the  number  had  risen  to  259  mills,  with  6,053,- 
231  spindles  and  76,898  looms.  In  1910  the  number 
rose  to  263  mills,  covering  6,195,671  spindles  and  82,- 
725  looms.  In  191 1  the  number  of  mills  remained  sta- 
tionary though  there  was  a  slight  increase  in  spindles 
and  looms.  In  191 3  the  number  of  mills  rose  to  272 
with  a  total  of  6,596,862  spindles  and  94,136  looms. 
In  1914  there  has  been  no  increase  in  the  number  of 


THE  COTTON  INDUSTRY  OF  INDIA      155 

mills,  though  there  has  been  a  slight  increase  in  the 
number  of  spindles  and  looms.  The  number  of  the 
latter  stood  on  August  31,  1915  at  6,898,744  and  108,- 
009  respectively.  The  following  figures  about  the  trade 
in  cotton  goods  might  be  useful  for  purpose  of  refer- 
ence: In  1915-16  the  Indian  mills'  outturn  in  yarn 
was  a  little  over  722  million  lbs.  and  in  woven  goods  a 
little  over  352  million  lbs.,  of  which  160  million  lbs. 
of  yarn  and  tweed  and  113  million  yards  of  piece 
goods  were  exported  as  against  198  and  89,  in 
1913-14  and  136  and  67  in  1914-15.  In  1913-14 
the  total  value  of  the  exports  of  cotton  manu- 
factures from  India,  is  given  at  a  little  over  8  million 
lbs.  sterling.  The  imports  of  cotton  manufactures  in 
that  year  were  valued  at  over  66  million  pounds  ster- 
Hng.  In  March,  1916,  at  the  time  of  the  Budget  dis- 
cussion, Sir  William  Meyer  informed  the  members  of 
the  Indian  Legislative  Council  that  in  deference  to  the 
unanimous  opinion  of  the  non-official  members,  Lord 
Hardinge's  Government  had  proposed  to  the  Secretary 
of  State  the  abolition  of  the  excise  duty  and  an  in- 
crease in  the  duty  on  imported  cotton  goods,  but  that 
the  Secretary  of  State  had  decided  that  the  considera- 
tion of  the  matter  might  be  postponed,  during  the 
war.^2  So  while  the  Government  of  India  increased 
the  price  of  salt  (manufactured  in  India  and  a  Gov- 
ernment monopoly)  they  had  to  submit  to  the  decision 
of  the  Secretary  of  State  in  the  matter  of  the  duties  on 
cotton  goods.  The  matter  has  been  thus  summed  up 
by  the  writer  of  the  article  on  "  Industrial  and  Eco- 

12  The  duty  has  now  been  raised  to  7^  per  cent.    The  excise 
duty  is  being  maintained  (see  P.  S.  Preface). 


156  ENGLAND'S  DEBT  TO  INDIA 

nomic  Conditions  "  in  the  volume  of  the  Oxford  Sur- 
vey of  the  British  Empire  dealing  with  Asia  (pages 
140,  141 )  : 

"  It  is  but  natural  that  Indian  politicians  should  ex- 
press dissatisfaction  with  the  meagre  results  at  present 
achieved  in  industrial  enterprise.  They  complain  that, 
in  the  interest  of  Lancashire,  their  cotton  fabrics  were 
first  excluded  from  the  English  market  and  now  suffer 
from  unrestricted  competition  at  home.  They  are  not 
content  with  the  exportation  of  raw  materials  as  an  in- 
dication of  prosperity,  but  rather  regret  that  these  are 
not  profitably  used  up  in  the  country.  They  quote  the 
dictum  of  Mill  that  *  nascent  industries  '  may  be  legiti- 
mately protected.  They  point  to  self-governing  col- 
onies which  are  allowed  to  impose  a  tariff  even  against 
the  mother  country.  They  point  also  to  the  analogous 
case  of  Japan,  whose  industrial  development,  fostered 
by  the  State,  already  threatens  rivalry  in  their  own 
markets.  These  complaints,  when  uttered  by  Indian 
representatives  in  the  reformed  legislative  Councils 
cannot  be  ignored,  especially  when  it  is  known  that 
Anglo-Indian  opinion,  both  official  and  commercial, 
largely  sympathises.  As  long  as  no  fresh  taxation  is 
required,  a  final  solution  of  the  problem  may  possibly 
be  postponed ;  but  when  the  time  comes  it  will  test,  as 
no  other  question  has  done,  the  altruism  of  English 
statesmanship." 

Before  bringing  this  chapter  to  a  close,  we  must,  in 
fairness  to  the  other  side,  mention  some  "  alleged  re- 
cent discoveries  "  of  a  retired  Indian  Civil  Servant, 
Mr.  C.  W.  McMin,  who  in  1908  read  a  paper  before 
the  East  India  Association,  extracts  from  which  have 
since  been  incorporated  into  a  pamphlet  entitled: 
"  Truths  About  India."  The  obvious  purpose  of  this 
document,  which  may  be  had  for  the  asking,  is  to  show 


THE  COTTON  INDUSTRY  OF  INDIA      157 


the  world  that  the  charge  brought  against  England  of 
the  "  destruction  of  indigenous  Indian  industries  "  is 
unfounded. 

A  few  extracts,  copied  verbatim,  are  appended  be- 
low, with  comments  by  the  author  opposite. 


EXTRACTS 
A 
"  In  a  great  work  on  '  Eco- 
nomic History  '  by  R.  C.  Dutt, 
it  is  stated  the  British  im- 
posed 'unjust  and  enormous' 
duty  on  Indian  cottons  of  20 
per  cent ;  on  reference  to  the 
quoted  authority  I  find  it  was 
4d.  per  cwt.  As  cotton  was 
5d.  per  lb.,  the  rate  was  less 
than  I  per  cent.  This  was 
not  printer's  deviltry,  for  taf- 
fetas, sugars,  mats  are  simi- 
larly misstated.  The  truth 
was  that  foreign  cotton  was 
paying  5s  lod.  per  cwt.  about 
20  per  cent,  while  Indian  cot- 
ton had  a  preferential  tariff, 
less  than  i  per  cent." 

B 
"  In  1789  England  reduced 
the  British  tariff  tax  on  tea 
to  121/2  per  cent,  on  piece 
goods  to  18  per  cent ;  and  to 
make  up  the  deficiency  so 
created,  in  the  Inland  Rev- 
enue, imposed  a  window  tax 
on  the  English  people.  This 
proved  a  hardship  and  evil  to 
the  poor  and  an  annoyance  to 
the  rich.  _  William  Pitt  did 
this ;  possibly  he  remembered 
that  Indian  trade  had  made 
his  grandfather  rich,  and 
founded  the  fortune  of  Chat- 
ham. Up  to  i860,  in  tariffs, 
Britain  favoured  India  more 


ANSWERS 
A 
Mr.  Dutt's  alleged  mistake 
has  nothing  to  do  with  man- 
ufactured cotton  and  silk 
goods.  How  England  treated 
Indian  raw  cotton  has  not 
been  treated  in  this  book  — 
it  was  to  her  interest  to  en- 
courage the  cultivation  of 
raw  cotton  in  India,  and  sup- 
ply it  as  cheaply  as  possible 
to  the  Lancashire  mills.  So 
the  point  made  in  the  extract 
is  of  no  significance  whatever. 


B 

The  statement  of  duties  on 
piece-goods  in  1789  does  not 
show  Baines'  scale  of  duties 
levied  on  "  East  Indian  White 
muslins  and  Nankeen,  to  be 
in  any  way  wrong.  Baines' 
table  covers  1787-1814,  and 
shows  that  the  duty  varied 
from  18  per  cent,  to  44  per 
cent,  ad  val.  and  from  £16 
15s.  3d.  in  1787  to  £85  2s.  id. 
per  piece  in  1813.  East  India 
dyed  goods  were  absolutely 
prohibited.  On  the  other 
hand,  bounties  were  given  for 
the  exportation  of  English 
cottons.    The  table  of  duties 


158 


ENGLAND'S  DEBT  TO  INDIA 


or  less.  In  1838  there  were 
43  articles,  every  important 
article  of  necessity  or  luxury, 
for  which  there  were  prefer- 
ential light  duties  for  British 
possessions.  For  raw  silk 
from  Bengal  there  was  a  spe- 
cial light  duty  — it  paid  4s.  6d. 
while  the  rest  of  the  world 
paid  5s.  lod.  per  lb.  British 
tariffs  were  not  only  just  to 
India,  but  even  benevolent 
from  1825  onward.  Opium, 
indigo,  tea,  jute,  cotton,  were 
bringing  wealth  to  the  Empire 
surpassing  the  Moguls. 

I  admit  that  in  Bengal  es- 
pecially for  the  first  20  years 
after  the  Company  assumed 
the  Dewani,  there  were  most 
serious  drawbacks  to  the 
peace  and  prosperity  intro- 
duced by  British  rule.  From 
1785  amendment  commenced 
due  to  a  great  improvement  in 
Customs  regulations,  and 
lower  tariffs  on  tea  and  piece- 
goods,  dating  1780-4. 


The  East  India  Company, 
far  from  being  hostile  to  In- 
dian manufactures,  spent 
about  £160,000,000  in  training 
artisans,  establishing  factor- 
ies, buying  and  transporting 
to  England  the  piece-goods, 
silk,  salt-petre,  indigo,  sugar, 
which  were  the  principal 
staples.  They  sold  piece 
goods  alone  for  659  million 
pounds  in  forty  years  (1771- 
1810). 


filed  before  the  Select  Com- 
mittee of  the  House  of  Com- 
mons in  1813  shows  the  duty 
on  "  Calicoes "  was  i8i  2s. 
I  id.  for  every  "  100  of  value" 
(also  cottons)  while  the  duty 
on  raw  cotton  was  i6s.  iid. 
per  100  lbs.  The  duty  on  tea 
in  1761,  customs  and  excise 
is  given  as  £96  os.  od.,  etc. 
The  statement  that  opium, 
indigo,  tea,  jute  and  ale 
brought  wealth  to  the  Empire 
is  true  if  by  "  Empire "  is 
meant  England  and  English 
manufacturers,  who  monop- 
olise those  industries  and  tne 
profits  therefrom. 


The  last  statement  is  too 
vague  to  be  tested.  The  East 
India  Company  in  its  char- 
acter as  trader,  was  inter- 
ested in  certain  industries  of 
which  it  had  the  monopoly. 
We  are  not  told  how  the 
£160,000,000  was  spent;  how 
much  in  "  training  artisans  " 
or  ill  what  kind  of  work, 
how  much  in  "  establishing 
factories  "  or  what  sorts ;  nor 
what  proportion  went  into 
the  pockets  of  the  Company's 
servants. 

Nor  was  there  anything  re- 
markable in  the  "  fact "  that 
in  forty  years,  1770-1810,  the 
East   India   Company   should 


THE  COTTON  INDUSTRY  OF  INDIA      159 

have  sold  goods  to  the  value 
of  659  milHons  of  pounds, — 
where  and  to  whom  is  not 
stated.  An  industry  like  that 
of  the  piece  goods  industry  of 
India  could  not  have  been 
destroyed  in  a  day. 

In  conclusion  it  is  well  to  recall  the  testimony  of 
such  competent  witnesses  as  Henry  St.  John  Tucker, 
Larpent,  Montgomery  Martin,  and  others. 

That  the  number  of  those  who  depend  on  textile 
industries  for  their  living  is  still  declining  is  made  clear 
by  the  results  of  the  census  of  191 1.  See  Mr.  Gait's 
report,  chapter  on  occupations,  wherein  he  says  that 
"As  compared  with  1901,  there  has  been  a  decrease  of 
6.1  per  cent,  in  the  number  of  persons  supported  by 
textile  industries.  This  is  due  mainly  to  the  almost 
complete  extinction  of  cotton  spinning  by  hand. 
Weaving  by  hand  has  also  suffered  severely." 

Cotton  duties — /p//  developments.  Since  the 
above  was  written,  the  duty  on  cotton  goods  imported 
into  India  has  been  raised  to  73^  per  cent,  ad  valorem 
while  the  countervailing  excise  duty  has  been  main- 
tained at  the  old  figure.  The  action  of  the  Govern- 
ment of  India,  taken  with  the  sanction  and  approval  of 
the  Secretary  of  State  for  India,  as  a  part  of  the  plan 
whereby  the  Government  of  India  was  to  contribute 
iioo,ooo,ooo  to  the  British  war  fund  as  a  "  free  gift," 
from  India  has  furnished  occasion  for  a  very  interest- 
ing discussion  on  the  point,  between  Lancashire  and 
the  Free  Traders  on  one  hand  and  the  Tory  Secre- 
tary of  State  for  India  and  The  Times  on  the  other. 
In  the  course  of  the  controversy  certain  admissions 
have  been  made  in  high  quarters  which  corroborate 


i6o  ENGLAND'S  DEBT  TO  INDIA 

and    support  the   statements   made    in    this    chapter. 

In  the  course  of  a  letter  addressed  to  the  West- 
minster Gazette,  Lord  Curzon  says : 

"  I  have  always  regarded  the  attitude  of  Lancashire 
toward  India  in  respect  to  the  Import  duties  on  cotton 
and  still  more  of  the  countervailing  excise  as  an  injus- 
tice and  a  wrong.  .  .  .  When  in  India,  as  Viceroy,  I 
more  than  once  expressed  myself  in  the  same  sense. 
On  my  return  to  England  I  made  a  speech  in  the 
House  of  Lords  on  May  21,  1908,  in  the  course  of 
which  I  said  that  the  fiscal  policy  of  India  during  the 
last  thirty  or  forty  years  has  been  shaped  far  more  in 
Manchester  than  in  Calcutta.  In  the  speech  at  Man- 
chester in  1910,  I  alluded  to  the  same  facts,  namely,  to 
the  subordination  of  Indian  fiscal  policy  to  the  Secre- 
tary of  State  and  a  House  of  Commons  powerfully 
affected  by  Lancashire  influence."  [The  italics  are 
ours.] 

Mr.  Charles  Roberts,  M.  P.,  said  in  the  House  of 
Commons :  "  Long  ago  we  forgave  ourselves  for  the 
selfish  commercial  policy  of  the  eighteenth  century 
which  crushed  out  the  beautiful  fabrics  of  India  by 
fiscal  prohibition." 

Mr.  G.  W.  Forrest,  writing  to  The  Times,  London, 
(March  14,  1917),  said:  "The  tale  of  England's 
dealing  with  Indian  industry  was  one  of  littleness  and 
injustice.  ...  By  positive  prohibition  and  by  heavy 
duties,  the  Indian  textile  trade  in  England  was  de- 
stroyed and  our  own  trade  was  fostered." 

Mr.  Harold  Smith,  M.  P.,  also  condemns  "  the  un- 
economic and  indefensible  protection  which  "  the  Brit- 
ish cotton  trade  "  has  received  at  the  expense  and  the 


THE  COTTON  INDUSTRY  OF  INDIA      i6i 

exploitation  of  India.  ...  It  is  impossible  that  India 
can  forever  remain  satisfied  with  this  throtthng  hold 
on  her  own  natural  development."  {Times,  London, 
March  14,  1917.) 

The  Times  has  defended  India's  right  to  levy  duties 
on  cotton  goods  in  the  course  of  several  leading  articles 
on  the  subject. 

We  beg  to  make  a  present  of  these  opinions  to  the 
East  Indian  Association  of  London,  with  reference  to 
their  book  called  "  Plain  Truths  About  India."  This 
addition  to  the  cotton  duties  has,  however,  been  char- 
acterised as  a  war  measure  and  we  are  not  quite  sure 
whether  it  will  be  maintained  after  the  war  is  over. 


CHAPTER  VI 

SHIPBUILDING  AND   SHIPPING 

Conditions  in  Former  Times.  Considering  that  In- 
dia has  a  seaboard  of  more  than  4000  miles  and  that 
except  in  the  north,  the  north-western,  and  the  north- 
eastern corners  of  the  peninsula,  the  only  outlets  to 
the  outside  world  are  by  sea,  there  is  no  wonder  that 
for  thousands  of  years  before  the  advent  of  the  Brit- 
ish, India  should  have  developed  shipping  and  mari- 
time trade  to  a  marvellous  extent.  There  is  ample 
justification  for  the  claim  made  for  her  by  one  of  the 
Indian  writers  on  the  subject,  that  "  the  early  growth 
of  her  shipping  and  shipbuilding,  coupled  with  the 
genius  and  energy  of  her  merchants,  the  skill  and  dar- 
ing of  her  seamen,  the  enterprise  of  her  colonists,  .  .  . 
secured  to  India  the  command  of  the  sea  for  ages  and 
helped  her  to  attain  and  long  maintain  her  proud  posi- 
tion as  the  mistress  of  the  Eastern  Seas." 

The  claim  has  been  made  good  in  an  excellent  bro- 
chure written  by  Prof.  Radhakumud  Mookerji  of  Cal- 
cutta, and  published  by  Messrs.  Longmans,  Green  and 
Co.  of  London.  The  work  is  called,  "  A  History  of 
Indian  Shipping  and  Maritime  Activity  from  the  Earli- 
est Times."  The  evidence  collected  in  this  volume  is 
both  indigenous  and  foreign  and  goes  back  to  about 
3000  years  b.  c.     Dr.  Sayce,  the  famous  Assyriologist, 

162 


SHIPBUILDING  AND  SHIPPING        163 

has  been  quoted  in  support  of  the  statement  that  com- 
merce by  sea  between  India  and  Babylon  must  have 
been  carried  on  as  early  as  about  3000  b.  c.  One  re-  ^ 
markable  feature  of  the  foreign  evidence  collected  by 
Professor  Mookerji  is  that  it  establishes  beyond  doubt 
that  for  ages  before  the  British  period,  India  was  a 
great  manufacturing  country  known  for  the  excellence 
of  her  fabrics  and  that  as  a  rule  she  was  principally  an 
exporter  of  manufactured  articles,  importing  only  gold 
and  silver  and  other  precious  metals.  As  early  as  the 
first  century  a.  d.  this  flow  of  gold  into  India  was  the 
cause  of  alarm  to  Pliny,  who  deplored  the  "  drain  " 
from  the  Roman  Empire  to  the  Orient  in  exchange  for 
articles  of  luxury.^  There  is  abundant  testimony  of 
Greek  and  Mohammedan  historians,  of  Chinese  and 
other  foreign  travellers  as  to  ships  of  war  forming  a 
regular  and  significant  feature  of  the  offensive  and  de- 
fensive equipment  of  Indian  rulers.  A  Board  of  Ad- 
miralty was  one  of  the  six  Boards  which  made  up  the 
War  Office  of  Chandra  Gupta,  the  Hindu  Emperor  of 
India,  who  reigned  from  321  b.  c.  to  297  b.  c.  Coming 
to  the  time  of  Akbar,  the  great  Mogul  who  was  a  con- 
temporary of  Elizabeth  in  the  sixteenth  century,  we 
find  elaborate  details  for  the  upkeep  of  the  Admiralty 
given  in  the  monumental  work  of  Abul  Fazal,  known  , 
as  the  Ayeen-i-Akbari  (the  laws  of  Akbar).  Akbar's 
Admiralty,  we  find  in  the  Ayeen-i-Akbari,  looked  to 
the  supply  and  building  of  ships.  Bengal,  Cashmeer 
and  Thatta  in  Sindh  were  famous  for  their  shipbuild- 
ing industry,  though  ships  were  built  nearly  everywhere 
on  the  banks  of  navigable  rivers  or  on  iseaboard.     The      \ 

*  Mark  the  use  of  the  word  "  drain  "  here. 


i64  ENGLAND'S  DEBT  TO  INDIA 

organisation  of  a  ship  given  in  the  Ayeen-i-Akbari,  is 
sure  to  be  of  interest  to  modern  readers  and  we  there- 
fore make  no  excuse  for  making  the  following  lengthy 
extract  from  Professor's  Mookerji's  book. 

"  The  second  duty  of  Akbar's  Admiralty  was  re- 
garding the  supply  of  men,  of  efficient  mariners  who 
knew  the  nature  of  tides,  the  depths  of  channels,  the 
coasts  to  be  avoided,  and  the  character  of  the  prevailing 
winds.  Every  ship  required  officers  and  men  of  the 
following  titles  and  descriptions :  (i)  The  Nakhoda, 
or  commander  of  vessel,  who  directed  the  course  of 
the  ship;  (2)  the  Manllim  (the  mate),  who  knew  the 
soundings,  the  situation  of  the  stars,  and  guided  the 
ship  safe  to  her  destination;  (3)  the  TundeU,  who  was 
the  chief  of  the  khelasses  or  sailors ;  (4)  the  Nakhodak- 
hesheh,  whose  duty  it  was  to  provide  fuel  for  the  peo- 
ple and  assist  in  lading  and  unlading  the  ship;  (5)  the 
Sirheng,  who  had  to  superintend  the  docking  and 
launching  of  the  ship ;  (6)  the  Bhandaree,  who  had 
charge  of  the  ship's  store;  (7)  the  Keranee,  or  ship's 
clerk,  who  kept  the  accounts  and  also  served  out 
water  to  the  people;  (8)  the  Sukangeer,  or  helmsman, 
of  whom  there  were  sometimes  twenty  in  a  ship;  (9) 
the  Punjeree,  whose  duty  it  was  to  look  out  from  the 
top  of  the  mast  and  give  notice  when  he  saw  land  or 
a  ship,  or  discovered  a  storm  rising,  or  any  other 
object  worth  observing;  (10)  the  Goomtee,  or  those 
particular  khelasses  who  threw  the  water  out  of  the 
ship;  (11)  the  gunners,  who  differed  in  number  ac- 
cording to  the  size  of  the  ship;  (12)  the  Kherzvah,  or 
common  seamen  who  were  employed  in  setting  and 
furling  the  sails  and  in  stopping  leaks,  and  in  case  of 
the  anchor  sticking  fast  in  the  ground  they  had  to  go 
to  the  bottom  of  the  water  to  set  it  free." 

It  might  be  noted  in  passing  that  Akbar  was  practically 
a  free-trader ;  the  duties  on  exports  and  imports  never 


SHIPBUILDING  AND  SHIPPING        165 

exceeded  2^^  per  cent.^  India  could  afford  to  be  a 
free-trader  then.  She  may  again  become  a  free- 
trader under  a  national  government,  but  the  present 
policy  of  free-trade  followed  by  a  foreign  Government 
is  inimical  to  her  industries. 

The  Venetian  traveller  Cesare  di  Fedrici,  writing 
about  the  year  1565,  states  that  such  was  the  abundance 
of  materials  for  shipbuilding  in  the  eastern  parts  of 
Bengal  that  the  Sultan  of  Constantinople  found  it 
cheaper  to  have  his  vessels  built  here  than  at  Alex- 
andria.^ Even  in  the  early  days  of  the  British  the 
shipping  industry  was  in  a  flourishing  condition  in  In- 
dia, The  East  India  Company  built  many  of  its  ships 
there.  A  building  yard  was  maintained  at  Surat, 
up  to  1735,  in  which  year  most  of  the  work  was  trans- 
ferred to  Bombay.  The  foreman  of  the  Surat  ship- 
yard was  a  Parsee  Indian.  In  1774  the  grandsons  of 
this  foreman,  Lowjee,  built  two  ships  of  900  tons  each. 
Later  on  in  the  latter  part  of  the  eighteenth  and  the 
early  part  of  the  nineteenth  century  in  this  ship  yard 
and  under  the  supervision  of  Indian  foremen  were  built 
nine  ships,  seven  frigates  and  six  smaller  vessels  for 
the  British  Royal  navy.  In  1802  the  British  Ad- 
miralty ordered  men-of-war  for  the  King's  navy  to 
be  constructed  at  Bombay.  The  master  builder  was  a 
Parsee.  From  1736  to  1837,  the  position  of  master- 
builder  was  always  held  by  an  Indian. 

In  1775,  a  visitor  recorded  the  following  observa- 
tion about  the  shipyard : 

"  Here  is  a  dockyard  large  and  well-contrived  with 

2  Ayeen-i-Akbari,  by  Gladwin,  p.  193;  quoted  by  Mookerji, 
p.  208. 

3  Taylor's  Topography  of  Dacca,  quoted  by  Mookerji. 


-y 


i66         ENGLAND'S  DEBT  TO  INDIA 

all  kinds  of  naval  stores  .  .  .  and  .  .  .  forges  for 
making  anchors.  It  boasts  such  a  dry-dock  as  is,  per- 
haps not  to  be  seen  in  any  part  of  Europe,  either  for 
size  or  convenient  situation^ 

Lieut.-Col.  A.  Walker  wrote  in  i8il :  "  The  docks 
(i.e.,  those  at  Bombay)  that  have  recently  been  con- 
structed are  capable  of  containing  vessels  of  any 
force." 

As  for  their  quality  the  same  authority  said : 

"  It  is  calculated  that  every  ship  in  the  navy  of  Great 
Britain  is  renewed  every  twelve  years.  It  is  well 
known  that  teak- wood  built  ships  last  fifty  years  and 
upwards.  Many  ships,  Bombay  built,  after  running 
fourteen  or  fifteen  years  have  been  brought  into  the 
navy  and  were  considered  as  strong  as  ever.  .  .  .  No 
Europe  built  Indiaman  is  capable  of  going  more  than 
six  voyages  with  safety." 

As  to  their  cost  the  same  authority  says :  "  Ships 
built  at  Bombay  also  are  executed  by  a  quarter  cheaper 
than  in  the  docks  of  England,  so  that  the  English- 
built  ships  requiring  to  be  renewed  every  twelve  years, 
the  expense  is  quadruple."  ^ 

The  East  India  Company  maintained  several  ship- 
yards in  Bengal,  but  gradually  Calcutta  came  to  be  the 
centre  of  the  industry. 

In  1781  to  1800  inclusive,  35  ships  with  a  total  ton- 
nage of  17,020,  were  built  at  Calcutta;  in  1801,  19 
ships  of  10,079  tons;  in  1813,  21  ships  of  10,376  tons. 
Including  the  above  from  1801  to  182 1,  both  inclusive, 
there  were  built  on  the  Hugh  237  ships  of   105,653 

*  The  History  of  the  Indian  Navy,  by  Lieutenant  C.  R.  Low, 
L.  N.,  and  other  authorities,  quoted  by  Mookerji,  p.  245. 
^Mookerji,  pp.  245,  246,  247. 


SHIPBUILDING  AND  SHIPPING        167 

tons,  which,  reckoned  at  an  average  cost  of  200  Rs 
per  ton  {£20  then)  cost  £2,000,000. 

Lord  Wellesley,  the  Governor  General  of  India, 
wrote  in  1800: 

"  From  the  quantity  of  private  tonnage  now  at  com- 
mand in  the  port  of  Calcutta,  from  the  state  of  perfec- 
tion which  the  art  of  shipbuilding  has  already  attained 
in  Bengal  (promising  a  still  more  rapid  progress  and 
supported  by  abundant  and  increasing  supply  of  tim- 
bers) it  is  certain  that  this  port  will  alzvays  be  able  to 
furnish  tonnage  to  whatever  extent  may  be  required 
for  conveying  to  the  Port  of  London  the  trade  of  the 
private  British  merchants  of  Bengal." 

A  Frenchman,  F.  Baltazar  Solvyns  has  recorded  the 
following  observation  (1811)  about  Indian  ships: 

"  In  ancient  times  the  Indians  excelled  in  the  art  of 
constructing  vessels,  and  the  present  Hindus  can  in  this 
respect  still  offer  models  to  Europe  —  so  much  so  that 
the  English,  attentive  to  everything  which  relates  to 
naval  architecture,  have  borrowed  from  the  Hindus 
many  improvements  which  they  have  adopted  with  suc- 
cess to  their  own  shipping.  The  Indian  vessels  unite 
elegance  and  utility,  and  are  models  of  fine  workman- 
ship." « 

The  Decline  of  the  Industry.  The  decline  of  the  In- 
dian Marine,  remarks  Mr.  Mookerji,  began  after  1840, 
no  large  ships  having  been  built  after  that  date.  "  It 
was  finally  abolished  in  April,  1863,  shortly  after  the 
assumption  of  the  Government  of  India  by  the 
Crown." '' 

«  Quoted  by  Mookerji,  p.  250. 

^  Italics  everywhere  in  this  chapter  are  ours. 


i68  ENGLAND'S  DEBT  TO  INDIA 

Reading  the  despatches  of  the  directors  of  the  East 
India  Company  of  1801  it  appears  that  shipbuilding  lin- 
gered in  India  for  more  than  half  a  century  against  the 
wishes  and  inclinations  of  her  masters.  In  a  despatch 
quoted  by  Mr.  Digby  on  page  loi  of  his  book  one  can 
find  "  the  reasons  "  against  shipbuilding  and  shipman- 
ning.  One  of  the  reasons  was  that  Indian-built  ships 
will  have  to  be  manned  by  Indian  sailors  which  was 
"  undesirable,"  "  inadvisable  "  and  "  unpatriotic." 
While  shipbuilding  was  stopped  in  India  only  sixty 
years  later,  the  Europe-built  ships  running  to  the  East 
continue  to  employ  Indian  sailors  to  a  considerable 
number,  though  in  the  lowest  capacities. 

The  changes  represent  (a)  the  destruction  of  the 
shipbuilding  industry,  (b)  and  the  bar  to  the  rank  of 
officers. 

"  Scarcely  anything  has  struck  me  more  forcibly," 
says  Mr.  Digby,  "  than  the  manner  in  which  the  Mis- 
tress of  the  Seas  in  the  Western  World  has  stricken  to 
death  the  Mistress  of  the  Seas  in  the  East."  Statistics 
from  the  beginning  of  the  century  are  not  available  — 
to  me  at  least  —  but  from  the  Statistical  Abstracts  I 
gather  the  following  significant  facts : 

1857  Vessels  Tonnage 

Indian   (entered  and  cleared)..../.....  34,286  1,219,958 

British  and   British-Indian    59,441  2,475,472 

1898-99 

Indian  (entered  and  cleared)  2,302  133.033 

British  and  British-Indian   6,219  7,685,009 

Foreign  1,165  1,297,604 

In  1899-1900  the  native  craft  declined  to  1776  (109,- 
813  tonnage).  The  present  conditions  (1912)  may  be 
judged  from  the  following  figures  taken  from  Mook- 
erji's  "  Conclusion." 


SHIPBUILDING  AND  SHIPPING        169 

Our  oceanic  trade  represents  11,800,000  tons,  our 
indigenous  shipping  represents  only  95,000  tons  or  only 
about  .8  per  cent.  Of  the  aggregate  tonnage  of  29.61 
million  tons  in  the  inter-portal  trade,  only  3.24  million 
tons  is  our  own  and  over  89  per  cent  foreign.  Our  na- 
tional shipping  at  the  present  day  consists  of  only  130 
vessels  of  under  80  tons  each,  used  in  the  oceanic  trade 
and  7280  in  the  inter-portal  trade  of  the  country  of  un- 
der 20  tons  each.  .  .  .  Our  shipbuilding  is  now  so  con- 
tracted as  to  give  employment  to  only  14,321  men,  who 
build  only  about  125  galbats  a  year. 

As  for  the  status  of  the  Indian  sailor,  he  is  after  all 
only  a  lostan,  at  best  only  a  Tindal.  In  19 12- 13  the 
total  number  of  ships  (sail  and  steam)  that  entered  the 
Indian  ports  was  4408,  with  a  tonnage  of  S,y2y,62y. 
The  number  of  those  that  cleared  from  Indian  ports 
was  4341,  with  a  tonnage  of  8,756,764.  Of  these,  Brit- 
ish Indians  were  313  and  296  respectively  of  188,977 
and  174,286  tonnage ;  and  native  craft  823  and  765  re- 
spectively (tonnage  65,076  and  62,822). 

The  following  figures  taken  from  the  Statistical  Ab- 
stract are  of  interest: 

No.  lyg. —  Number  and  Tonnage  of  Steam  and  Sail- 
ing Vessels  which  Entered  with  Cargoes  or  in  Ballast 
from  Foreign  Countries,  distinguishing  Nationalities. 


British 

British  Indian 

No 

ifive 

No. 

Tons 

No. 

Tons 

No. 

Tons 

1904-05 

2,843 

5,820,723 

522 

55,398 

1,022  ' 

62,840 

1905-06 

2,408 

5,079,474 

468 

47,250 

1,065 

59,096 

1906-07 

2,476 

5,461,686 

351 

80,171 

1,394 

93,323 

1907-08 

2,397 

5,375,833 

396 

306,668 

1,384 

87,529 

1908-09 

2,144 

4,936,332 

325 

203,338 

1,117 

79,400 

1909-10 

2,395 

5,693,703  ■ 

36s 

142,716 

780 

62,731 

I9I0-II 

2,417 

5,916,437 

312 

162,695 

1,049 

70,564 

I9II-I2 

2,582 

6,370,217 

325 

204,512 

946 

72,591 

I9I2-I3 

2,544 

6,521,527 

313 

188,977 

832 

65,076 

I9I3-I4 

2,444 

6,198,848 

243 

152,678 

853 

63,062 

I70  ENGLAND'S  DEBT  TO  INDIA 

A^o.  i8o. —  Number  and  Tonnage  of  Steam  and  Sail- 
ing Vessels  which  cleared  with  Cargoes  or  in  Ballast 
to  Foreign   Countries,   distinguishing  Nationalities. 


British 

British  Indian 

Native 

No. 

Tons 

No. 

Tons 

No. 

Tons 

1904-05 

2,790 

5,723,410 

509 

48,197 

938 

58,340 

1905-06 

2,430 

5,070,609 

490 

48,835 

1,112 

62,657 

1906-07 

2,442 

5,422,275 

388 

99,190 

1,174 

76,809 

1907-08 

2,388 

5,419,334 

478 

349,808 

1,204 

79,333 

1908-09 

2,094 

4,886,545 

386 

247,387 

946 

67,579 

1909-10 

2,327 

5,660,314 

408 

200,952 

681 

48,804 

I9I0-II 

2,334 

5.799,263 

325 

187,788 

1,075 

68,362 

19II-I2 

2,535 

6,347,338 

322 

208,836 

922 

71,451 

1912-13 

2,577 

6,613,992 

296 

174,286 

765 

62,822 

1913-14 

2,507 

6,486,282 

260 

145,216 

844 

63,871 

But  even  of  greater  interest  are  the  figures  of  ships 
built  at  Indian  ports. 


SHIPBUILDING  AND  SHIPPING        171 


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ENGLAND'S  DEBT  TO  INDIA 


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CHAPTER  VII 

MISCELLANEOUS    INDUSTRIAL,    AGRICULTURAL,    AND 
MINING   OPERATIONS 

In  the  preceding  pages  we  have  related  the  story 
of  the  cotton  industry  and  the  shipbuilding  indus- 
try: in  what  condition  they  were  before  the  British 
took  possession  of  India,  and  how  they  have  fared 
since.  In  this  section  we  give  the  reader  a  general  idea 
about  other  industries  and  also  about  the  general  im- 
port and  export  trade. 

Indigo.  India  from  time  immemorial  had  been  fa- 
mous for  its  beautiful  dyes.  The  dyeing  industry  was 
closely  connected  with  weaving,  and  the  colours  in 
which  cotton  and  silk  fabrics  were  woven  increased 
immensely  their  price  and  their  acceptabihty.  Most  of 
the  dyes  were  produced  from  vegetables.  "  Indigo, 
lac,  safflower  and  tumeric,  moski,  horitoki,  maujestha 
and  vandis  flowers  were  the  ingredients." 

The  trade  in  indigo  was  made  a  European  monopoly 
in  the  very  early  days  of  British  rule.  It  is  one  of  the 
darkest  chapters  of  the  history  of  Bengal  and  Bihar 
that  tells  of  the  wrongs  and  oppressions  committed  on 
Indians  by  the  European  indigo  planters.  In  his  sur- 
vey of  Bengal  made  in  the  early  years  of  the  nineteenth 
century.  Dr.  Buchanan  gives  the  details  of  the  industry 
as  he  found  it  in  each  district  and  also  of  the  way  in 
which  the  European  license  holders  treated  the  native 
growers. 

173 


174  ENGLAND'S  DEBT  TO  INDIA 

Among  other  causes  of  complaint  he  mentions  that 
the  planter  considers  the  growers  "  as  his  slaves,  beats 
and  confines  them  whenever  he  is  dissatisfied,"  that  the 
growers  are  "  cheated  both  in  the  measure  of  their 
land  and  in  the  measure  of  the  weed  " ;  that  the  plant- 
ers are  "  insolent  and  violent." 

So  frequent  were  the  acts  of  violence  committed  by 
European  indigo  planters  that  the  government  was 
compelled  to  issue  circulars  to  magistrates  drawing 
their  attention  to  "  the  offence  "  which  had  been  estab- 
lished "  beyond  all  doubt  or  dispute  against  individual 
planters." 

The  manufacture  of  indigo  is  not  an  important  in- 
dustry now.  It  has  been  killed  principally  by  the  im- 
ports of  dyes  from  Germany. 

J  lite.  The  jute  industry  owes  its  growth  to  quite 
recent  times.  It  is  said  that  "  about  sixty  years  ago 
jute  was  almost  unknown."  ^ 

The  total  area  under  cultivation  (mainly  in  eastern 
and  northern  Bengal  "  exceeds  three  million  acres,  and 
the  output  may  be  estimated  at  more  than  eight  million 
bags  (of  600  lbs.)  of  which  nearly  half  is  exported  raw, 
the  rest  being  worked  up  in  the  mills  near  Calcutta."  ^ 

"  The  jute  mills  are  nearly  all  concentrated  in  Ben- 
gal in  the  vicinity  of  Calcutta  and  are  mostly  in  the 
hands  of  British  firms."  ^ 

1  have  italicised  the  word  "  mostly."  It  would  have 
been  perhaps  nearer  the  truth  to  say  "  nearly  all." 

Woollen  Mills.     There  were   six  woollen  mills  at 

1"  Oxford  Survey"  (Asia,  1911),  p.  132. 

2  Ibid. 

8  "  Parliamentary  Blue  Book  Relating  to  the  Moral  and  Ma- 
terial Progress  of  India  for  the  year  1913-14,"  p.  63. 


MISCELLANEOUS  OPERATIONS       175 

work  at  the  end  of  1913,  containing  1086  looms  and 
38,963  spindles  and  producing  goods  valued  at  i374,- 
000  for  the  year.^  They  are  most  of  them,  if  not  all, 
in  the  hands  of  British  firms. 

Paper  Mills.  There  were  seven  paper  mills  at  work 
at  the  end  of  1913,  producing  during  the  year  sixty 
million  pounds  of  paper  valued  at  £535,800.  (In  the 
year  1913  we  imported  paper  of  the  value  of  about  nine 
millions  sterling  from  foreign  countries,  of  which  about 
six  millions'  worth  came  from  the  United  Kingdom 
alone.)  The  industry  is  principally  in  the  hands  of 
British  firms,  only  two  of  the  five  larger  mills  being 
in  native  hands.  In  the  Indian  year  book  for  1917 
the  total  number  of  paper  mills  in  India  at  the  end  of 
1915-16  is  given  at  eleven,  but  it  is  said  that  only  seven 
were  in  operation. 

Breweries.  This  is  a  purely  British  industry  in 
British  hands.  At  the  end  of  1913  there  were  twenty- 
one  breweries  which  produced  during  the  year  3,654,- 
000  gallons  of  beer. 

Rice  Mills  and  Saw  Mills.  Rice  mills  and  saw  mills 
are  most  numerous  in  Burma,  and  "  are  mainly  in  Eu- 
ropean hands,"  being  "  the  only  large  industries  in 
Burma,  organised  and  worked  by  Western  methods."  ^ 

Iron.  "  Iron  ore  of  rich  quality  is  widely  distributed 
over  the  country,"  says  Mr.  J.  S.  Cotton,  editor  of  the 
Imperial  Gaseteer  and  the  writer  of  the  chapter  on 
Industrial  and  Economic  Conditions  in  the  "  Oxford 
Survey  of  British  Empire"  (Asia,  191 1). 

«  "  Blue  Book  on  the  Moral  and  Material  Progress  of  India 
for  1913-14,"  p.  63. 


176         ENGLAND'S  DEBT  TO  INDIA 

"  In  former  times  iron  smelting  in  little  charcoal 
furnaces  was  a  common  industry.  The  steel  thus  pro- 
duced tinder  the  name  of  zvootz,  anticipated  by  many 
centuries  the  finest  qualities  of  the  modern  European 
product.  Indeed  the  iron  age  in  India  .  .  .  has  been 
placed  as  early  as  1500  b.  c.  But  no  local  industry  has 
suffered  more  from  importation  than  that  of  iron- 
smelting.  Apart  from  two  Capitalist  enterprises  the 
total  value  of  iron  ore  mined  is  estimated  at  only 
i 1 5,000,  while  the  annual  imports  of  iron  and  steel 
exceed  £4,000,000."  ^ 

Yet  there  is  not  a  single  good  school  for  the  teaching 
of  mining  in  the  country !  The  College  of  Engineer- 
ing pretends  to  make  a  provision  for  teaching  a  mining 
course  which  was  being  pursued  at  the  beginning  of  the 
session  1913-14  by  a  group  of  16  students.  We  are 
further  told  that  at  lectures  delivered  at  five  centres 
in  the  Bengal  coal  fields  under  lecturers  appointed  by 
the  mining  Educational  Board  there  were  360  reg- 
istered students  and,  in  June,  1913,  17  had  qualified 
for  certificates.  The  Mining  and  Geological  Institute 
of  India,  which  was  inaugurated  at  the  end  of  1905, 
numbers  308  members.'  The  Tata  Iron  and  Steel 
Works  is  an  Indian  concern,  which  is  trying  to  revive 
the  industry.  They  started  work  in  1912  and  Mr.  J. 
S.  Cotton  says  that  "  it  is  interesting  to  learn  that  a 
much  larger  proportion  of  the  labour  is  in  the  hands  of 
trained  Indians  than  was  anticipated."  Where  did  the 
Indians  who  are  engaged  in  this  industry  secure  their 
training?  Most  probably  in  America,  perhaps  some  in 
Europe. 

6  "Oxford  Survey"  (Asia),  p.  143.     The  italics  are  ours. 

7  "  Blue  Book  Relating  to  Moral  and  Material  Progress  of 
India  for  1913-14,"  p.  60. 


MISCELLANEOUS  OPERATIONS       177 

The  total  output  of  Indian  iron  ore  in  19 14  was  a 
little  under  442,000  tons  which  in  191 5  fell  to  about 
390,000  tons.  The  amount  of  pig  iron  produced  dur- 
ing the  year  by  the  Tata  Company  was  156,500  tons 
and  by  the  Bengal  Iron  and  Steel  Company  87,285 
tons.  The  former  company  produced  76,355  tons  of 
steel  including  16,871  tons  of  steel  rails  and  the  latter 
25,634  tons  of  cast  iron  castings.  ("  The  Indian  Year 
Book,  1917,"  p.  332.) 

Copper.  "  Copper  ore  is  likewise  widely  distributed 
over  the  country,  especially  in  the  north,  but  it  is  no- 
where now  worked  profitably,  whereas  the  importation 
of  copper  amounts  to  nearly  £2,000,000."  ^ 

Manganese.  "  More  important  than  any  of  these  is 
manganese  ore,"  says  Mr.  Cotton,  "  the  mining  of 
which  began  in  the  last  decade  of  the  nineteenth  cen- 
tury and  has  advanced  so  rapidly  that  India  now  ranks 
as  the  second  country  (after  Russia)  for  the  produc- 
tion of  this  substance.  .  .  .  The  ores  are  exceedingly 
rich,  and  they  are  exported  in  bulk  to  be  smelted 
abroad.  The  annual  production  has  reached  900,000 
tons  valued  at  £577,000."  ^  The  number  of  mangan- 
ese quarries  worked  in  British  territory  alone  is  forty- 
one,  employing  more  than  7000  persons.  "  The  In- 
dian Year  Book  for  191 5  "  (published  by  the  Times 
of  India  Office,  Bombay)  says  that  "  India  now  takes 
the  first  place  among  manganese  producing  countries 
in  the  world."  In  191 5  the  output  was  450,416  tons, 
valued  at  £929,546. 

8 "Oxford  Survey"  (Asia),  p.  144.     Italics  are  ours. 
» In   1913-14  the   quantity   produced   was  815,047   tons,   the 
value  £1^211.036.    See  "  Blue  Book  for  1913-14." 


1/8  ENGLAND'S  DEBT  TO  INDIA 

That  is  a  matter  of  great  satisfaction,  except  that 
the  profits  are  almost  exclusively  monopolised  by  Eu- 
ropeans. 

Coal.  The  total  output  of  coal  in  1913-14  was  16,- 
208,000  tons,  of  which  723,641  tons  were  exported. 
In  this  year  559,190  tons  were  imported  into  India. 
In  1915-16,  the  Indian  output  was  17,103,932  tons,  of 
which  we  exported  751,801  tons  as  against  175,000  tons 
imported.  This  is  probably  the  only  mineral  product 
the  profits  of  which  go  partly  into  the  pockets  of  the 
Indians,  because  most  of  the  coal  raised  in  India  comes 
from  Bengal  and  the  Bengal  Zemindar  has  used  his 
opportunities  to  advantage.  In  what  proportion  the 
industry  is  owned  by  Europeans  and  by  natives,  I  have 
no  means  of  saying. 

Other  Minerals.  The  following  table  gives  the 
value  of  minerals  produced  in  1915: 

iprs 

Coal    ^3,781,064 

Gold    2,369,486 

Petroleum    1,256,803 

Manganese-ore     929.546 

Salt   660,250 

Mica     183,947 

Saltpetre    373-891 

Lead-ore  and  Lead   316,182 

Tungsten-ore     296,772 

Of  these  we  have  already  dealt  with  coal  and  man- 
ganese ;  salt  is  a  government  monopoly ;  petroleum, 
gold,  mica,  lead-ore,  lead  and  tungsten-ore  are  prin- 
cipally in  European  hands ;  saltpetre  and  building  ma- 
terials and  road  metals  are  shared  by  both  but  prob- 
ably by  far  the  larger  share  is  in  native  hands. 


MISCELLANEOUS  OPERATIONS       179 

Tea  and  Coffee.  Both  these  industries  are  in  the 
hands  of  Europeans  and  have  been  the  source  of  un- 
told misery  to  the  people  cI  India  for  the  reason  that 
in  the  interest  of  European  capital  the  Government  of 
India  has  been  lending  itself  to  make  special  legislative 
provisions  for  the  supply  of  indentured  labourers  for 
the  tea  plantations  in  Assam. 

"Of  crops  grown  with  European  capital  and  under 
European  supervision  by  far  the  most  important  is 
tea,"  says  Mr.  Cotton  in  the  "  Oxford  Survey  of 
British  Empire"  (Asia),  page  133.  In  1915  the 
area  under  cultivation  for  tea  was  636,218  acres.  In 
191 5,  the  total  production  was  371,836,668  pounds,  of 
which  291,795,041  pounds  were  exported.  The  cap- 
ital of  joint  stock  companies  engaged  in  this  business 
was  about  £20.7  millions  in  191 5,  of  which  £17,670,760 
is  owned  by  companies  registered  in  Great  Britain  and 
Ireland.  The  balance,  less  than  three  millions,  belongs 
to  companies  registered  in  India,  which  does  not  mean 
that  they  are  constituted  of  Indians.^"  The  great  bulk 
of  the  Indian  companies  also  are  European  in  mem- 
bership; so  practically  the  whole  profits  of  this  in- 
dustry go  to  European  pockets.  The  coolies  em- 
ployed under  special  laws  enacted  for  the  benefit  of 
the  European  capitalist  have  the  hardest  possible  time 
and  get  practically  slave  wages.  The  total  exports  of 
tea  in  1915  amounted  to  340,433,163  lbs. 

CofTee  planting  is  confined  to  Southern  India  where 
it  is  said  to  be  "  pursued  by  Indians  as  well  as  by  Eu- 

10  "  The  Indian  Year  Book  for  1917,"  published  by  the  Times 
of  India  Press. 


i8o  ENGLAND'S  DEBT  TO  INDIA 

ropeans."  The  industry  is  "  stationary,  if  not  declin- 
ing." The  total  exports  in  1915  amounted  to  290,000 
cwts. 


CHAPTER  VIII 

AGRICULTURE 

India's  Greatest  Industry.  In  the  preceding  chap- 
ters we  have  discussed  the  "  minor  "  industries  of  In- 
dia. We  have  shown  how  the  cotton  and  silk  in- 
dustries were  crushed  in  the  early  days  of  British  rule ; 
to  what  extent  they  have  been  revived  and  what  ham- 
pers their  further  growth;  how  the  shipping  industry 
has  vanished ;  and  how  the  country  stands  in  the  mat- 
ter of  its  mineral  produce.  We  have  also  shown  who 
controls  and  benefits  from  the  other  principal  modern 
industries  of  India,  such  as  jute,  tea  and  coffee. 

In  this  chapter  we  propose  to  discuss  what,  by  com- 
mon consent,  is  the  greatest  industry  of  India.  "  In 
India,"  says  Mr.  J.  S.  Cotton  in  the  Oxford  Survey, 
"  agriculture  forms  the  one  predominant  industry  to  an 
extent  which  is  difficult  for  those  to  realise  who  are 
familiar  only  with  the  conditions  prevailing  in  Eng- 
land. According  to  the  occupation  returns  of  the  cen- 
sus of  1901,  almost  two-thirds  of  the  total  population 
of  294  millions  are  supported  directly  by  agriculture 
proper  and  the  subordinate  industry  of  cattle  raising; 
but  if  those  supported  indirectly  be  included  it  has  been 
estimated  that  the  proportion  would  rise  to  nine-tenths, 
leaving  only  one-tenth  for  all  the  towns  inhabited  by  as 
many  as  5,000  persons  each." 

181 


i82  ENGLAND'S  DEBT  TO  INDIA 

The  annual  harvests  are  therefore  a  subject  of  su- 
preme concern  not  only  to  the  cultivators  themselves, 
but  also  to  the  Government,  and  it  might  be  added,  to 
the  people  at  large.  Nay,  one  might  go  a  step  further 
and  say  that  they  are  of  supreme  importance  to  the 
workers  of  Great  Britain,  as  well. 

The  failure  of  a  single  harvest  in  India  means 
famine,  which  may  possibly  result  in  a  temporary 
fall  in  revenue  collections  but  which  does  certainly  in- 
volve a  heavy  expenditure  for  famine  relief  and  also  a 
certain  decline  in  imports.  The  revenue  from  land  is 
the  principal  source  of  government  income,  the  realisa- 
tion from  land  tax  alone  forming  about  one-third  of 
revenue  proper  of  the  Government  of  India.  In  the 
budget  figures  of  1914-15,  the  realisation  from  the  land 
tax  was  shown  to  be  a  little  less  than  21  J/2  million 
pounds  sterling  out  of  a  total  of  slightly  over  85  mil- 
lions sterling,  the  estimated  income  from  all  sources 
including  railway  receipts,  proceeds  of  opium  and  canal 
receipts  for  1913-14,  Customs  in  India  bring  only  a 
paltry  sum.  In  1913-14  there  was  an  income  of  7)^ 
millions  sterling  from  customs,  while  the  realisation 
from  the  income  tax  was  £1,950,250.  In  1914-15  the 
figures  were  £5,960,469  and  £2,036,733  respectively. 

The  land  tax  is  not  levied  on  the  actual  produce  of 
the  year.  It  is  generally  assessed  for  a  number  of 
years  varying  from  ten  to  thirty  years,  except  in  certain 
areas  where  it  has  been  permanently  fixed.  The  fail- 
ure of  harvest  therefore  does  not  necessarily  mean  a 
reduction  in  Government  income.  Suspensions  of  one 
year  are  as  a  rule  made  good  in  another,  and  remissions 
are   few.     On  the  other  hand,  the  sufferings  of  the 


AGRICULTURE  183 

people  assume  so  terrible  a  shape  that  the  Government 
is  compelled  to  spend  large  sums  of  money  on  "  famine 
relief."  Of  famines,  of  deaths  from  famine,  of  collec- 
tions of  revenue  during  famine  years,  and  of  the  gov- 
ernment expenditure  for  famine  relief,  we  will  speak 
in  detail  later  on.  A  famine  year  is  generally  a  bad 
one  for  imports,  and  a  falling  off  in  imports  affects 
British  industries.  A  failure  of  harvest  in  India 
thus  spells  not  only  disaster  to  India  but  loss  to  Great 
Britain  as  well.  The  very  fact  that  90  per  cent,  of 
the  population  should  depend  almost  solely  on  such  a 
precarious  industry  as  agriculture  is  sufficiently  con- 
demnatory of  the  system  of  administration  that  has 
failed  to  look  ahead  and  make  provision  for  other 
sources  of  national  income  which  would  secure  variety 
of  occupation  to  the  workers  of  the  country  and  insure 
them  against  unemployment  and  starvation  in  the  event 
of  agriculture  failing  them. 

The  total  cropped  area  (net  after  deducting  area 
cropped  more  than  once)  in  1914-15  was  227,611,132 
acres  out  of  a  total  net  area  by  professional  survey  of 
619,392,157  acres. 

By  crops  the  area  stood  as  below:  — 

1913-14  1914-15 

for  British  India    for  whole  India 

Acres  Acres 

Rice 60,320,000  77,668,882 

Wheat 20,476,000  25,451,330 

Other    food    grains    (chiefly 

millet  and  pulse)    76,217,000  93,479.555 

Barley    5,844,000  7.904,783 

Total      food      grains      and 

pulses    162,966,000  204,504,550 

Oil  seeds  12,675,000  I5.333.59i 

Sugar  crops  2,432,000  2,458,865 

Cotton 15,665,000  15,221,787 

Jute  2,817,000  3,308,718 


i84  ENGLAND'S  DEBT  TO  INDIA 

The  yield  returns  are  given  for  the  whole  of  India 
including  the  native  states. 

1913-14  1914-15  . 

Estimated  Estimated 

Area  in  Acres          Yield  Area                  Yield 

Rice   70,583,000     563,332,000  cwts.  76,181,000       27,964,000  cwts. 

Wheat    27,697,000         8,427,000  tons  32,230,000       10,269,000  tons 

Sugar     2,519,800         2,262,000  tons  2,315,000         2,367,000  tons 

Tea     610,000     307,250,000  lbs  622,600  312,976,000  lbs 

Jute    3,359fOoo       10,444,000  bales  2,377,000         7,429,000  bales 

(1914) 

Cotton     24,595,000         5,201,000  bales    24,632,000         5,232,000  bales 

Oilseeds    ....      15,720,000         2,565,000  tons  Not  Given 

The  figures  for  1913-14  are  taken  from  the  "  Par- 
liamentary Blue  Book  on  India  for  1913-14,"  and 
those  for  1914-15  from  the  "  Indian  Year  Book  for 
1917."    The  yield  returns  are  taken  from  Blue  Books. 

India  produces  almost  half  the  rice  of  the  world. 
All  exports  of  rice  are  subject  to  a  duty  of  about 
six  shillings  ten  pence  per  ton.  In  191 3-14  India  ex- 
ported rice  to  the  value  of  £17,738,000  (as  valued  at 
Indian  ports)  as  against  £21,704,000  worth  of  rice  ex- 
ported in  the  year  before.  The  figures  for  1914-15  are 
not  given  in  the  Blue  Book,  but  it  is  said  that  there 
was  a  falling  off  in  exports. 

The  export  figures  of  wheat  and  wheat  flour  are  sub- 
ject to  great  fluctuations.  It  is  said  that  "  in  a  famine 
year,  the  export  falls  to  a  trifling  quantity,"  which  fact 
is  not  borne  out  by  the  table  of  exports  given  in  the 
margin  of  the  Blue  Book  which  shows  the  maximum 
quantity  of  wheat  exported  in  1904-05  at  2,150,000 
tons.  Except  in  one  year  during  the  ten  years,  the 
quantity  exported  did  not  fall  below  801,400  tons. 
The  only  exception  is  for  the  year  1908-09  when  the 
quantity  exported  fell  to  109,750  tons  of  wheat  and 
30,100  tons  of  wheat  flour.  In  1914-15  the  exports  of 
wheat  were  706,400  tons  and  of  flour  54,000  tons. 


AGRICULTURE  185 

The  following  are  the  export  figures  of  tea,  jute, 
cotton,  and  oilseeds  for  1913-14  and  1914-15: 

J913-14  1914-15 

Tea    289.5  millions  of  lbs.  300.8  millions  of  lbs. 

Jute    ....      768,000  tons  of  the  value  1  3,046,000  bales 

of  £39,400,000 
Cotton  . .  10,626,000  cwts.  10,349,000   cwts.    valued 

at  £22,326,000 
Oilseeds  .  31,652,000  cwts.  19,078,000  cwts. 

To  what  extent  India  meets  the  requirements  of  the 
United  Kingdom  in  the  matter  of  raw  produce  may  be 
judged  from  the  following  figures  for  the  years 
1903-04  to  1912-13  taken  from  the  Statistical  Abstract 
for  British  India: 

IMPORTS  OF   AGRICULTURAL   PRODUCE   FROM    INDIA   INTO 
GREAT   BRITAIN 

Raw  Jute 

1903-04 ±"3480,398 

1904-05  3,298,003 

I905HD6  4,876.823 

1906-07  7,707,883 

1907-08 4,683,34s 

1908-09  5,601,794 

1909-10  4,289,508 

I9I0-II  3,885,292 

I9II-I2  6,530,513 

I9I2-I3  7,352,171 

I9I3-I4 7,826,358 

The  United  Kingdom  is  the  largest  importer  of  raw 
jute  from  India. 

Ratv  Wool 

1903-04  £  891,011 

1904-05  1,139,181 

1905-06 1,337,108 

1906-07  1,547,306 

1  The  values  of  exports  are  those  of  the  ports  from  which 
these  articles  were  shipped. 


i86  ENGLAND'S  DEBT  TO  INDIA 

1907-08  ^1,365,631 

1908-09  1,364,536 

1909-10  1,850,846 

1910-11  1,867,323 

191 1-12  1,659,622 

1912-13  1,704,785 

1913-14 1,621,111 

The  United  Kingdom  is  not  only  the  largest  im- 
porter of  raw  wool,  but  practically  the  whole  of  the 
raw  wool  exported  by  India  goes  to  the  United  King- 
dom. Out  of  a  total  of  £1,756,448  worth  of  raw  wool 
exported  in  1912-13,  the  United  Kingdom  took  of  the 
value  of  £1,704,785. 

Rice 

1903-04 £1,047,551 

1904-0S  1,096,965 

1905-06 993,008 

1906-07  836,225 

1907-08 1,096,369 

1908-09 790,195 

1909-10 842,946 

1910-11  1,022,480 

1911-12  932,871 

1912-13 1,305,463 

1913-14 1,129,677 

Wheat 

1903-04  £6,032,913 

1904-05  7,994,302 

1905-06 4,276,648 

1906-07  4,396,807 

1907-08  - 5,052,461 

1908-09  836,956 

1909-10  7,130,489 

1910-1 1  7,1 13,542 

191 1-12 6,741,190 

1912-13  8,380,442 

1913-14 5,694,757 

The  United  Kingdom  is  not  only  the  largest  buyer 
of  wheat  from  India  but  in  some  years  takes  prac- 


AGRICULTURE  187 

tically  the  whole  of  the  total  quantity  exported.  That 
was  so  until  1908-09.  In  1909  and  19 10,  she  took 
more  than  £7,000,000  worth  out  of  a  total  of  almost 
£8,500,000  worth  exported.  In  1911-12  she  took 
£6,741,190  worth  of  wheat  of  a  total  of  £8,898,972  ex- 
ported and  in  1912-13  £8,380,422  worth  out  of  a  total 
of  £11,795,816. 

Barley 

1903-04 £     10,777 

1904-05  3,548 

1905-06  2,765 

1906-07  74.157 

1907-08 239,459 

1908-09  39,796 

1909-10 67,954 

1910-11  54,172 

191 1-12  873,948 

1912-13  1,737,542 

1913-14  817,562 

The  United  Kingdom  is  the  greatest  consumer  of 
Indian  barley.  In  seeds,  again,  we  find  that  the 
United  Kingdom  heads  the  list  of  importers  from 
India. 

Tea 

U.  K.  Total 

1903-04  4,726,074  pounds  5,705,288  pounds 

1904-05    4,473,166      "  5,643,657 

1905-06    4,593,453      "  5,898,402 

1906-07    5,049,684      "  6,571,843 

1907-08    5,056,618      "  6,866,899 

1908-09    5,^23,037      "  6,929,141 

1909-10   5,885,463      "  7,804,936 

1910-11    5,915,923      "  8,277,579 

1911-12    6,353,755      "  8,630,952 

1912-13    6,325,049      "  8,862,651 

191 3-14 7,232,049     "  9,983,372 

More  than  two-thirds  of  the  tea  exported  from  In- 
dia goes  to  the  United  Kingdom. 


i88  ENGLAND'S  DEBT  TO  INDIA 

Similarly  the  United  Kingdom  gets  the  largest  quan- 
tity of  raw  skins,  dressed  or  tanned  hides  and  dressed 

or  tanned  skins. 

Land  Tax.  For  the  latest  figures  of  land  revenue 
and  the  official  explanation  of  the  policy  underlying 
them,  we  make  the  following  lengthy  quotation  from 
the  Parliamentary  Blue  Book  for  1913: 

"  From  time  immemorial  a  share  of  the  produce  of 
the  land  has  been  the  chief  source  of  public  revenue  in 
India.  Land  revenue  is  still  the  mainstay  of  the  Gov- 
ernment, constituting  about  36  per  cent,  of  the  total 
net  revenue  that  accrues  to  the  Indian  Exchequer.^ 

"  Owing  to  its  far-reaching  social  and  political  ef- 
fects the  proper  administration  of  the  land  revenue  has 
always  been  one  of  the  chief  problems  of  the  Indian 
Government,  and  during  the  early  years  of  British  rule 
the  best  methods  of  assessment  were  keenly  debated. 
In  1793  Lord  Cornwallis  introduced  into  Bengal  a  per- 
manent settlement,  by  which  the  demand  of  the  State 
was  fixed  and  made  for  ever  unalterable.  Other  sys- 
tems were  gradually  evolved,  and  at  length  over  the 
greater  part  of  India  a  system  of  periodical  settlements 
was  established,  under  which  the  State  demand  is  re- 
vised at  recurring  periods  of  twenty  to  thirty  years,  the 
latter  period  prevailing  in  all  the  larger  provinces  ex- 
cept the  Punjab  and  the  Central  Provinces,  where  set- 
tlements are  usually  made  for  twenty  years,  and  in 
Burma,  where  the  term  of  twenty  years  is  now  being 
adopted.  Under  the  system  of  periodical  revisions  of 
the  land  assessment  the  State  secures  a  share  in  the 
increased  rental  value  arising  from  the  general  prog- 

2  The  statement  is  repeated  every  year. 


AGRICULTURE  189 

ress  of  the  community.  Of  late  years  measures  have 
been  taken  to  exempt  improvements  from  assessment, 
and  generally  to  make  the  enforcement  of  the  rights  of 
the  State  as  little  burdensome  as  is  possible  to  the 
revenue-payer.  Periodical  revision  also  affords  the 
opportunity  of  reducing  the  assessment  in  villages  or 
tracts  which  have  declined  in  prosperity  and  of  cor- 
recting inequalities  arising  from  any  cause. 

"  When  the  revenue  is  assessed  by  the  State  per- 
manently or  temporarily,  on  an  individual  or  com- 
munity owning  an  estate,  and  occupying  a  position 
identical  with,  or  analogous  to,  that  of  a  landlord,  the 
assessment  is  known  as  za^nindari;  where  the  revenue 
is  imposed  on  individuals  who  are,  or  who  represent, 
the  actual  occupants  of  holdings,  the  assessment  is 
known  as  ryotwari.  Under  either  system  there  may 
be  rent-paying  sub-tenants.  In  Southern  India,  where 
most  of  the  land  is  held  by  petty  occupiers  direct  from 
the  State,  the  occupiers  have  the  right  to  retain  their 
holdings  so  long  as  they  pay  the  revenue  due  from 
them.  The  permanently  settled  districts,  in  which  all 
holdings  are  samindari,  cover  most  of  Bengal  and  Bi- 
har, and  parts  of  Madras  and  the  United  Provinces. 
As  regards  temporarily  settled  districts,  zamindari  es- 
tates, held  by  proprietary  groups  or  large  individual 
proprietors,  are  chiefly  found  in  the  Punjab,  the  United 
Provinces,  the  Central  Provinces,  and  Orissa,  while  in 
Bombay  and  Sindh,  Burma,  Assam,  Berar,  and  two- 
thirds  of  Madras  the  system  of  ryotwari,  or  peasant 
proprietors,  prevails. 

"  Revenue  Assessments  and  Incidence.  Land  reve- 
nue is  realised  in  the  form  of  an  annual  payment  of 


190  ENGLAND'S  DEBT  TO  INDIA 

cash,  the  assessment  rates  being  subject  to  no  alteration 
during  the  term  of  a  settlement,  though  the  amount 
leviable  in  any  year  may  vary  according  to  the  area 
actually  cultivated  or  to  the  condition  of  the  harvest.^ 
Except  in  Bombay  (where  assessment  is  not  fixed  in 
terms  of  produce)  the  land  revenue  is  assessed  so  as 
to  represent  a  share,  not  of  the  gross,  but  of  the  net 
produce  (or  net  assets).  In  the  zamindari,  or  land- 
lord settlements,  that  widely  prevail  in  Northern  In- 
dia, the  cultivating  tenant  pays  rent  to  a  landlord.  Of 
this  rent  the  Government  usually  takes  rather  less  than 
50  per  cent,  as  land  revenue. 

"  It  is  certain  that  the  Government  now  *  takes  a 
very  much  smaller  share  of  the  gross  product  than 
ivas  customary  in  pre-British  days.  The  incidence  of 
ordinary  land  revenue  for  all  British  India  in  1913-14 
works  out  at  is.  8d.  per  head  of  the  population.^ 

"  The  Government  makes  liberal  reductions  of  as- 
sessments in  cases  of  local  deterioration,  where  such 
reductions  cannot  be  claimed  under  the  terms  of  set- 
tlement." 

The  fiscal  policy  of  the  British  Government  is  an 
anomaly  from  more  than  one  point  of  view.  It  in- 
sists on  imposing  a  heavy  tax  on  land  and  agriculture 
in  pursuance  of  the  "  universal  practice  of  the  coun- 
try "  but  ignores : 

(a)  That  under  the  best  Hindu  and  Mohammedan 
rulers  the  Land  Tax  was  practically  the  sole  tax  levied 

3  This  is  true  only  of  the  small  area  of  land  settled  on  the 
basis  of  every  year's  produce  called  fluctuating  assessment. 

*  Mark  the  force  of  the  word  noiv  put  in  capitals  by  me. 

°  It  varies  from  4s.  per  head  in  Berar,  over  3s.  5d.  in  Bom- 
bay to  I  id.  in  Bengal. 


AGRICULTURE  191 

upon  the  people.  A  great  many  of  the  other  taxes 
imposed  by  the  British  Government  were  unknown  to 
the  country.  There  was  no  income  tax,  no  tax  on 
justice,  no  stamp  tax  and  no  duty  on  succession. 

(b)  That  all  the  proceeds  of  the  tax  were  spent  in 
the  country  and  returned  to  the  people  in  different 
forms  like  showers  of  rain  from  clouds  formed  of 
water  sucked  by  the  rays  of  the  sun  in  the  hottest 
months  of  the  year. 

(c)  That  except  under  the  Moguls,  the  Government 
share  was  taken  in  produce.  There  was  no  fixed  cash 
assessment.  Besides,  there  were  many  ways  of  avoid- 
ing the  giving  of  the  full  share,  which  cannot  be  used 
under  the  British  system  organised  as  it  is  to  the 
minutest  detail. 

(d)  Excessive  demands  were  opposed  or  stopped  by 
threats  of  revolt  which  kept  the  demands  within  proper 
bounds.  A  revolt  of  the  peasantry  under  the  British 
rule  is  impossible.  The  rate  at  which  the  Land  Tax  is 
fixed  in  India  is  unheard  of  in  any  other  part  of  the 
globe  and  is  the  principal  if  not  the  only  cause  of  the 
appalling  poverty  of  the  agricultural  masses. 

(e)  Formerly  large  numbers  were  employed  in 
other  industries  which  have  been  driven  out  of  exist- 
ence under  British  rule.  The  numbers  supported  by 
industries  other  than  agriculture  have  been  steadily 
falling  off  (see  the  191 1  census  report  of  India,  by 
Gait,  I.  C.  S.,  chapter  on  occupations).  It  is  no  credit 
to  an  enlightened  Government  hke  the  British  that  they 
should  justify  their  policy  on  the  ground  of  the  "  uni- 
versal practice  of  the  country."  Under  the  light  of 
modern  civilisation  many  an  immemorial  practice  has 


192  ENGLAND'S  DEBT  TO  INDIA 

been  discontinued  and  even  the  British  Government  in 
India  has  given  aid  to  stop  and  prohibit  practices  which 
were  considered  immoral  and  iniquitous. 

The  tests  which  should  be  applied  are:  Is  the 
land  tax  just?  Is  it  moderate?  Is  it  fair?  Does  it 
leave  sufficient  margin  to  the  agriculturist  to  live  a 
decent  life?  Does  it  not  result  in  an  unequal  distribu- 
tion of  the  burdens  of  Government  in  favour  of  the 
moneyed  classes?  Judged  by  these  standards  there 
can  be  no  doubt  that  the  rate  at  which  land  tax  is 
assessed  is  unjust,  unfair  and  excessive.  It  tells  ex- 
tremely heavily  on  the  very  class  which  ought  to  be 
protected  by  an  enlightened  system  of  administration. 
The  poor  require  protection  against  the  wealthy;  the 
weak  against  the  strong,  yet  the  present  system  of  tax- 
ation maintained  under  the  plea  of  ^  "  an  immemorial 
practice "  tells  most  heavily  on  the  poorest  and  the 
weakest.  It  is  they  who  have  to  live  on  insufficient 
food  from  day's  end  to  day's  end ;  it  is  they  who  are 
not  only  underfed  but  also  underclothed,  and  whose 
children  have  to  go  without  education  and  are  crush- 
ingly  handicapped  in  the  struggle  for  life  and  in  the 
race  for  progress.  Yet  it  is  they  who  fight  for  the 
Empire  and  lose  life  and  limb  in  the  service  of  the 
Government.  Many  a  noble-minded  Englishman  has 
felt  the  injustice  of  the  system. 

But  one  strong  feature  of  the  British  system  in  India 
is  that  the  Home  Government,  while  it  professes  to 
support  the  man  on  the  spot  in  all  measures  of  repres- 
sion, in  all  things  which  aflfect  the  dignity  and  privilege 

8  See  Thorburn's  "The  Punjab  in  Peace  and  War"  (1904), 
P-  175- 


AGRICULTURE  193 

of  the  ruling  classes,  in  all  recommendations  which  re- 
fuse to  make  concessions  to  public  opinion,  in  all  things 
which  tend  to  perpetuate  power  in  the  hands  of  the 
bureaucracy  to  the  detriment  of  the  people,  has  in 
numerous  instances  overruled  the  men  on  the  spot  when 
the  latter  made  recommendations  favourable  to  the 
people.  Men  realising  large  revenues,  inventing  new 
sources  of  income,  have  been  honoured  and  promoted ; 
men  making  light  assessments  have  been  dismissed,  de- 
ported or  censured.  The  Government  has  often  used 
the  authority  of  eminent  Anglo-Indian  Administrators 
in  support  of  its  policy,  ignoring  those  portions  of 
their  opinions  or  recommendations  which  were  favour- 
able to  the  people.  They  have  always  accepted  what 
was  likely  to  bring  them  larger  revenues,  rejecting  safe- 
guards provided  against  hardship. 

The  economic  history  of  India  amply  shows  how 
the  recommendations  of  the  men  on  the  spot  in  favour 
of  a  just  and  more  considerate  treatment  of  the  cul- 
tivator in  the  matter  of  land  tax,  as  also  their  recom- 
mendations in  favour  of  import  duties  in  the  interests 
of  Indian  industries,  have  from  time  to  time  been  ve- 
toed by  the  authorities  in  England.  In  the  preceding 
chapter  we  have  referred  to  the  praiseworthy  attempts 
of  Anglo-Indian  Administrators  in  the  matter  of  im- 
port duties.  In  this  chapter  we  show  how  the  efforts 
of  eminent  Anglo-Indian  statesmen  in  the  matter  of  se- 
curing a  fixity  of  land  revenue  demand  and  of  modera- 
tion in  the  rates  have  from  time  to  time  failed.  The 
history  of  the  land  tax  is  as  full  of  painful  incidents 
as  the  history  of  Indian  industries. 

Bengal.    The  first  chapter  of  the  history  of  land 


194  ENGLAND'S  DEBT  TO  INDIA 

administration  by  the  East  India  Company  opens  with 
the  management  of  districts  made  over  to  them  in  Ben- 
gal and  in  the  Karnatic  by  the  native  ruhng  princes  in 
payment  of  debts  incurred  on  account  of  subsidies 
promised,  but  not  paid.  It  also  includes  the  story  of 
the  management  of  lands  or  tracts  the  revenues  of 
which  were  assigned  to  European  servants  of  the  East 
India  Company  in  liquidation  of  the  private  debts  ad- 
vanced by  the  latter  to  the  ruling  Princes  of  Bengal  and 
Karnatic  and  swelled  to  fabulous  sums  by  all  the  meth- 
ods of  chicanery  and  fraud  known  to  money-lenders. 
These  lands  were  not  crown  lands  that  could  be  given 
away  by  the  ruling  princes  without  any  regard  to  the 
rights  of  those  who  owned  them  or  held  them.  They 
were  lands  which  in  many  cases  had  been  owned  and 
held  for  generations  in  the  families  of  the  then  existing 
owners,  occupiers  or  holders  thereof.  The  only  right 
which  the  ruling  Princes  had  was  the  Government's 
share  of  the  produce,  call  it  revenue  or  rent  as  you 
please.  Yet  the  East  India  Company  and  its  European 
servants  treated  these  assignments  of  revenue  as  if  the 
lands  themselves  had  been  given  to  them  in  complete 
ownership,  regardless  of  the  rights  of  those  to  whom 
they  had  belonged  or  by  whom  they  had  been  cultivated 
or  held  in  some  sort  of  tenure  for  generations.  Estates 
held  for  generations  were  put  to  auction  and  given  over 
to  the  highest  bidder.  "  In  the  provinces  of  Burdwan 
and  Midnapur,"  wrote  Governor  Verelst  in  a  letter  to 
the  Directors  of  the  East  India  Company  on  December 
i6,  1769,  "  those  evils  which  necessarily  flowed  from 
the  bad  policy  of  the  Moorish  Government  had  in  no 


AGRICULTURE  195 

sort  decreased.     On  the  contrary,  a  plan  was  adopted 
in  1762  productive  of  certain  ruin  to  the  province." 

"  The  lands  were  let  by  public  auction  for  the  short 
term  of  three  years.  Men  without  fortune  or  char- 
acter became  bidders  at  the  sale ;  and  while  some  of 
the  former  farmers,  unwilling  to  relinquish  their  habi- 
tations, exceeded  perhaps  the  real  value  in  their  offers, 
those  who  had  nothing  to  lose  advanced  yet  further, 
wishing  at  all  events  to  obtain  an  immediate  posses- 
sion. Thus  numberless  harpies  were  let  loose  to 
plunder,  whom  the  spoil  of  a  miserable  people  enabled 
to  complete  their  first  year's  payment." 

The  intense  cruelty  and  heartlessness  with  which 
revenues  were  collected  in  Bengal  is  proved  by  docu- 
mentary evidence  on  the  subject.  In  a  letter  of  the 
Directors  of  May  9,  1770,  occur  the  following  sen- 
tences : 

"  The  famine  which  has  ensued,  the  mortality,  the 
beggary,  exceed  all  description.  Above  one-third  of 
the  inhabitants  have  perished  in  the  once  plentiful 
province  of  Purneah,  and  in  other  parts  the  misery  is 
equal."  On  the  nth  September  they  wrote:  "It  is 
scarcely  possible  that  any  description  could  be  an  ex- 
aggeration of  the  misery  the  inhabitants  .  .  .  have 
encountered  with.  It  is  not  then  to  be  wondered  that 
this  calamity  has  had  its  influence  on  the  collections ; 
but  we  are  happy  to  remark  they  have  fallen  less  short 
than  we  supposed  they  would." 

On  the  I2th  February  they  wrote :  "  Notwith- 
standing the  great  severity  of  the  late  famine  and  the 
great  reduction  of  people  thereby,  some  increase  has 
been  made  in  the  settlements  both  of  the  Bengal  and 
the  Behar  provinces  for  the  present  year." 

On  the    loth  January,    1772,  they  wrote:    "The 


196  ENGLAND'S  DEBT  TO  INDIA 

collections  in  each  department  of  revenue  are  as  suc- 
cessfully carried  on  for  the  present  year  as  we  could 
have  wished." 

It  is  painful  to  read  of  this  rigorous  collection  of  the 
land  tax  during  years  of  human  sufferings  and  deaths, 
perhaps  unexampled  in  the  history  of  mankind. 

It  was  officially  estimated  that  in  the  famine  of  1770 
about  one-third  of  the  population  of  Bengal  or  about 
ten  millions  of  people  had  died.  Wrote  Warren  Hast- 
ings on  November  3,  1772 : 

"  Notwithstanding  the  loss  of  at  least  one-third  of 
the  inhabitants  of  the  province,  and  the  consequent 
decrease  of  the  cultivation,  the  net  collections  of  the 
year  1771  exceeded  even  those  of  1768.  ...  It  was 
naturally  to  be  expected  that  the  diminution  of  the 
revenue  should  have  kept  an  equal  pace  with  the 
other  consequences  of  so  great  a  calamity.  That  it 
did  not  was  owing  to  its  being  violently  kept  up  to 
its  former  standard.^ 

Later  on,  when  the  East  India  Company  had  the 
Dewani  or  the  revenue  administration  of  the  three 
provinces  of  Bengal,  Behar  and  Orissa,  conferred  on 
it  by  the  Great  Mogul,  a  dual  system  was  set  up  by 
which  the  collection  of  revenue  was  done  by  the  serv- 
ants of  the  Nabob  under  the  superintendence  of  super- 
visors appointed  by  the  Company's  Government.  This 
system  was  bad  enough  for  the  landlord  and  the  cul- 
tivator, but  the  worst  was  yet  to  come.  In  1776  War- 
ren Hastings  and  Barwell  proposed  that  estates  should 
be  sold  by  public  auction  or  farmed  out  on  leases,  and 

''Extracts  from  India  Office  Records,  quoted  in  Hunter's 
"Annals  of  Rural  Bengal,"  1868,  p.  381. 


AGRICULTURE  197 

settlements  should  be  made  with  purchasers  or  lessees 
for  life.  This  was  of  course  in  utter  disregard  of  the 
rights  of  those  who  had  held  the  lands  for  generations 
before.  Philip  Francis,  another  member  of  the  Ben- 
gal Council,  saw  the  evil  and  proposed  a  permanent  set- 
tlement. The  most  valuable  part  of  his  minute,  how- 
ever, is  that  in  which  he  describes  the  system  then  in 
vogue.  But  the  Directors  would  not  agree  to  letting 
the  land  on  lease  for  years  or  in  perpetuity.  In  1778, 
1779  and  1780  the  system  of  five  year  leases  was  given 
up  and  estates  were  let  annually. 

In  1781  a  new  settlement  was  aflfected,  this  time  pref- 
erence being  given  to  Zemindars  (landlords),  though 
for  one  year  only,  by  which  the  land  revenues  in- 
creased by  about  £260,000.^ 

Similarly  harsh  measures  were  adopted  in  the  Upper 
Provinces,  which  the  rapacity  of  Warren  Hastings 
managed  to  bring  under  the  control  of  the  East  India 
Company.  How  Warren  Hastings  coerced  the  Raja 
of  Benares  and  then  the  Nabob  Vizier  of  Oudh  are 
matters  of  political  history.^ 

Bengal,  however,  soon  obtained  relief  by  the  per- 
manent settlement  of  Lord  Cornwallis,  effected  with 
the  Zemindars  on  a  basis  of  nine-tenths  of  the  actual 
rental  then  received  by  them.     But  the  Upper  Prov- 

8  What  happened  to  the  great  families  of  Bengal  under  this 
system  has  been  stated  by  Mr.  R.  C.  Dutt  in  his  book  "  India 
Under  Early  British  Rule"  as  also  by  Torrens  in  "The  Em- 
pire in  Asia." 

8  A  brief  synopsis  of  these  most  oppressive  transactions  is 
given  by  Mr.  R.  C.  Dutt  in  his  "  India  Under  Early  British 
Rule,"  pp.  70-76,  or  the  reader  may  read  the  account  in 
James  Mill's  "  History  of  British  India."  The  revenue  which 
was  to  accrue  from  these  acquisitions  was  estimated  at  £237,000. 


198  ENGLAND'S  DEBT  TO  INDIA 

inces  did  not  receive  the  full  benefit  of  this  concession 
because  at  that  time  they  were  still  nominally  under 
native  government.  It  v.  ill  be  interesting  to  compare 
the  results  of  this  settlement  in  the  field  of  revenue 
with  those  of  native  rulers  previous  to  the  advent  of 
the  British,  We  take  the  figures  from  the  famous 
"  Minute  "  of  Mr.  Shore,  afterwards  Lord  Teign- 
mouth,  of  June  i8,  1789: 

By  Todar  Mall's  seUlement,  1582 £1,070,000  or  $5,350,000 

By  Sultan  Suja's  settlement,  1658 1,312,000  or    6,560,000 

By  Jaffar  Khan's  settlement,  1722  ....  1,429,000  or  7,145,000 
By  Suja  Khan's  settlement,  1728 1,425,000  or    7,125,000 

The  actual  collections,  however,  of  the  five  years 
immediately  preceding  British  rule  were: 

1762-63  1 646,000  or  $3,230,000 

1763-64  762,000  or  3,610,000 

1764-65  818,000  or  4,090,000 

1765-66  1,470,000  or  7,350,000 

The  last  year  was  the  first  year  of  the  Dewani 
granted  to  the  British  by  the  Mogul.  The  collections 
were  made  by  Mohammed  Raza  Khan  under  the  dual 
authority  of  the  Nabob  and  the  Company. 

The  collections  made  by  the  British  in  1790-91  were 
i2,68o,ooo  or  $13,400,000,  which  was  nearly  double  the 
assessment  of  Jafifar  Khan  and  of  Suja  Khan  in  the 
early  part  of  the  century;  it  was  three  times  the  col- 
lection of  Maharaja  Nandkumar  in  the  year  1764-65, 
and  it  was  nearly  double  the  collection  made  by  Mo- 
hammed Raza  Khan  under  British  supervision  in  the 
first  year  of  the  Company's  Dewani.  Yet  it  was  a  re- 
lief to  the  people  of  Bengal  because  it  was  final  and 
permanent.^" 

1°  It  was  Bengal  which  had  suffered  terribly  from  the  rapac- 


AGRICULTURE  199 

Madras.  From  Bengal  let  us  turn  to  Madras.  The 
story  begins  with  the  assignments  of  land  revenues 
made  by  the  Nabob  of  Karnatic  in  payment  of  his 
debts  to  the  Company  and  its  servants.  The  results  of 
the  system  were  testified  to  by  one,  Mr.  George  Smith, 
in  his  evidence  before  the  Parliamentary  Committee  in 
1782. 

'*  George  Smith,  Esquire,  attending  according  to  or- 
der, was  asked  how  long  he  resided  in  India,  where, 
and  in  what  capacity?  He  said  he  arrived  in  India  in 
the  year  1764;  he  resided  in  Madras  from  1767  to 
October,  1779.  Being  asked  what  was  the  state  of 
trade  at  Madras  at  the  time  when  he  first  knew  it,  he 
said  it  was  in  a  flourishing  condition,  and  Madras 
one  of  the  first  marts  in  India.  Being  asked  in  what 
condition  did  he  leave  it  with  respect  to  trade,  he 
replied  at  the  time  of  his  leaving  it,  there  was  little 
or  no  trade,  and  but  one  ship  belonging  to  the  place. 
Being  asked  in  what  state  the  interior  country  of 
the  Karnatic  was  with  regard  to  commerce  and  cul- 
tivation when  he  first  knew  it,  he  said  at  that  period  he 
understood  the  Karnatic  to  be  in  a  well-cultivated  and 
populous  condition,  and  as  such  consuming  a  great 
many  articles  of  merchandise  and  trade.  Being  asked 
in  what  condition  it  was  when  he  left  Madras  with 
respect  to  cultivation,  population,  and  internal  com- 
merce, he  said  in  respect  to  cultivation,  greatly  on  the 
decline,  and  also  in  respect  of  population ;  and  as  to 
commerce,  exceedingly  circumscribed." 

Speaking  of  the  Principality  of  Tanjore,  in  the  Prov- 
ince of  Karnatic,  one  Mr.  Petrie  said  in  his  evidence 
before  the  Committee  of  Secrecy  in  1782 : 

ity  of  the  early  British  Administrators  and  if  she  has  prospered 
under  the  permanent  settlement,  she  has  well  earned  that  pros- 
perity by  her  early  losses. 


200  ENGLAND'S  DEBT  TO  INDIA 

"  Before  I  speak  of  the  present  state  of  Tanjore 
country  it  will  be  necessary  to  inform  the  Committee 
that  not  many  years  ago  that  province  was  considered 
as  one  of  the  most  flourishing,  best  cultivated,  populous 
districts  in  Hindustan.  I  first  saw  this  country  in 
1768,  when  it  presented  a  very  different  picture  from 
its  present  situation.  Tanjore  was  formerly  a  place 
of  great  foreign  and  inland  trade;  it  imported  cotton 
from  Bombay  and  Surat,  raw  and  worked  silks  from 
Bengal ;  sugar,  spices,  etc.,  from  Sumatra,  Malacca,  and 
the  eastern  islands ;  gold,  horses,  elephants,  and  timber 
from  Pegu,  and  various  articles  of  trade  from  China. 
It  was  by  means  of  Tanjore  that  a  great  part  of 
Haidar  All's  dominions  and  the  north-western  parts 
of  the  Mahratta  empire  were  supplied  with  many 
European  commodities,  and  with  a  species  of  silk 
manufacture  from  Bengal,  which  is  almost  universally 
worn  as  a  part  of  dress  by  the  natives  of  Hindustan. 
The  exports  of  Tanjore  were  muslins,  chintz,  hand- 
kerchiefs, ginghams,  various  sorts  of  long-cloths,  and 
a  coarse  printed  cloth,  which  last  constitutes  a  ma- 
terial article  in  the  investments  of  the  Dutch  and  the 
Danes,  being  in  great  demand  for  the  African,  West 
Indian,  and  South  American  markets.  Few  countries 
have  more  natural  advantages  than  Tanjore ;  it 
possesses  a  rich  and  fertile  soil,  singularly  well  sup- 
plied with  water  from  the  two  great  rivers  Cavery  and 
Coleroon,  which,  by  means  of  reservoirs,  sluices,  and 
canals,  are  made  to  disperse  their  waters  through  al- 
most every  field  in  the  country ;  to  this  latter  cause 
we  may  chiefly  attribute  the  uncommon  fertility  of 
Tanjore.  The  face  of  the  country  is  beautifully  di- 
versified, and  in  its  appearance  approaches  nearer  to 
England  than  any  other  part  of  India  that  I  have  seen. 
Such  was  Tanjore  not  many  years  ago,  but  its  decline 
has  been  so  rapid,  that  in  many  districts  it  would  be 
difficult  to  trace  the  remains  of  its  former  opulence.  .  .  . 

"At  this  period  (1771),  as  I  have  been  informed, 
the  manufacturers  flourished,  the  country  was  populous 


AGRICULTURE  201 

and  well  cultivated,  the  inhabitants  were  wealthy  and 
industrious.  Since  the  year  177 1,  the  era  of  the  first 
siege,  until  the  restoration  of  the  Raja,  the  country 
having  been  during  that  period  twice  the  seat  of  war, 
and  having  undergone  revolutions  in  the  government, 
trade,  manufactures,  and  agriculture  were  neglected, 
and  many  thousands  of  inhabitants  went  in  quest  of  a 
more  secure  abode." 

How  fabulous  fortunes  were  made  by  the  servants 
of  the  East  India  Company;  how  their  interests  came 
into  conflict  with  the  interests  of  the  Company ;  how 
the  latter  censured  the  former;  how  the  matter  was 
eventually  brought  before  Parliament  for  final  settle- 
ment of  the  debts  claimed  from  the  Nawab  by  indi- 
viduals once  in  the  employ  of  the  Company ;  how  seats 
in  Parliament  were  purchased  by  one  of  them,  Mr. 
Paul  Benfield,  and  how  eventually  all  debts  were  real- 
ised up  to  the  last  penny,  are  matters  which  do  not 
properly  fall  within  the  scope  of  the  chapter.  Mr. 
Dutt  has  described  them  with  some  detail  and  they  may 
be  studied  there.  The  following  quotation  from  James 
Mill's  "  History  of  British  India  "  and  from  Burke's 
speech  delivered  in  the  discussion  on  the  Nawab  of 
Arcot's  debts,  may  however  be  given  here  as  a  sample 
of  how  things  were  managed  in  those  days: 

"  It  was  to  hold  the  corrupt  benefit  of  a  large  par- 
liamentary interest,  created  by  the  creditors  and  crea- 
tures, fraudulent  and  not  fraudulent,  of  the  Nawab 
of  Arcot,  that  ...  the  Ministry  of  1784  decided  that 
they  should  all,  whether  fraudulent  or  not  fraudulent, 
receive  their  demands."  ^^ 

"  Paul  Benfield  is  the  grand  parliamentary  reformer. 

11  Mill's  "  History  of  British  India,"  book  vi.  chap.  I. 


202  ENGLAND'S  DEBT  TO  INDIA 

What  region  in  the  empire,  what  city,  what  borough, 
what  country,  what  tribunal  in  this  kingdom,  is  not 
full  of  his  labours?  In  order  to  station  a  steady  pha- 
lanx for  all  future  reforms,  the  public-spirited  usurer, 
amidst  his  charitable  toils  for  the  relief  of  India,  did 
not  forget  the  poor  rotten  constitution  of  his  native 
country.  For  her  he  did  not  disdain  to  stoop  to  the 
trade  of  a  wholesale  upholsterer  for  this  House,  to 
furnish  it,  not  with  the  faded  tapestry  figures  of  anti- 
quated merit,  such  as  decorate,  and  may  reproach, 
some  other  Houses,  but  with  real,  solid,  living  patterns 
of  true  modern  virtue.  Paul  Benfield  made,  reckon- 
ing himself,  no  fewer  than  eight  members  of  the  last 
Parliament.  What  copious  streams  of  pure  blood  must 
he  not  have  transfused  into  the  veins  of  the  Pres- 
ent. .  .  . 

"  For  your  Minister,  this  worn-out  veteran  (Ben- 
field's  agent)  submitted  to  enter  into  the  dusty  field  of 
the  London  contest ;  and  you  will  remember  that  in 
the  same  virtuous  cause  he  submitted  to  keep  a  sort 
of  public  office  or  countinghouse,  where  the  whole  busi- 
ness of  the  last  general  election  was  managed.  It 
was  openly  managed  by  the  direct  agent  and  attorney 
of  Benfield.  It  was  managed  upon  Indian  principles 
and  for  an  Indian  interest.  This  was  the  golden  cup 
of  abominations  .  .  .  which  so  many  of  the  people, 
so  many  of  the  nobles  of  this  land,  had  drained  to  the 
very  dregs.  Do  you  think  that  no  reckoning  was  to 
follow  this  lewd  debauch?  That  no  payment  was  to 
be  demanded  for  this  riot  of  public  drunkenness  and 
national  prostitution?  Here  you  have  it,  here  before 
you.  The  principal  of  the  grand  election  manager 
must  be  indemnified.  Accordingly  the  claims  of  Ben- 
field and  his  crew  must  be  put  above  all  inquiry."  ^^ 

An  account  of  what  happened  to  Madras  under  the 
British  Land  Administration  system  may  profitably  be 

12  Burke's  speech  on  the  Nawab  of  Arcot's  debts. 


AGRICULTURE  203 

preceded  by  a  brief  description  of  the  condition  of 
things  before  the  British  took  charge  of  the  country.      . 
It  appears  from  the  reports  made  by  the  Committee  of  "^ 
Secrecy  that  had  been  appointed  by  the  Court  of  Di- 
rectors (originally  in  1775,  abolished  in  1778,  revived 
in  1783)  to  inquire  into  the  state  of  the  Northern  Cir- 
cars  in  the  Madras  Presidencyj  that  land  in  that  part     i 
of   the   country   was   held   partly   by  Zemindars  and 
partly  by  cultivators  direct  under  the  ruling  authority. 
In  the  fifth  report  of  this  inquiry  is  given  an  account  ^ 
of  the  village  community  which  is  too  valuable  to  be 
omitted. 

"  A  village,  geographically  considered,  is  a  tract  of 
country  comprising  some  hundreds  or  thousands  of 
acres  of  arable  and  waste  land;  politically  viewed,  it 
resembles  a  corporation  or  township.  Its  proper  es- 
tablishment of  officers  and  servants  consists  of  the  fol- 
lowing descriptions:  The  potail,  or  head  inhabitant, 
who  has  the  general  superintendence  of  the  affairs  of 
the  village,  settles  the  disputes  of  the  inhabitants,  at- 
tends to  the  police,  and  performs  the  duty,  already  de- 
scribed, of  collecting  the  revenues  within  his  village, 
a  duty  which  his  personal  influence  and  minute  ac- 
quaintance with  the  situation  and  concerns  of  the 
people  renders  him  best  qualified  to  discharge ;  the 
curnum,  who  keeps  the  accounts  of  cultivation  and 
registers  everything  concerned  with  it ;  the  talliar  and 
totie,  the  duty  of  the  former  appearing  to  consist  in  a 
wider  and  more  enlarged  sphere  of  action,  in  gaining 
information  of  crimes  and  offences,  and  in  escorting 
and  protecting  persons  travelling  from  one  village  to 
another,  the  province  of  the  latter  appearing  to  be 
more  immediately  confined  to  the  village,  consisting, 
among  other  duties,  in  guarding  the  crops  and  assisting 
in  measuring  them ;  the  boundary-man,  who  preserves 


204  ENGLAND'S  DEBT  TO  INDIA 

the  limits  of  the  village  or  gives  evidence  respecting 
them  in  case  of  dispute;  the  superintendent  of  tanks 
and  water-courses  distributes  the  water  therefrom  for 
the  purpose  of  agriculture;  the  Bramin,  who  performs 
the  village  worship ;  the  schoolmaster,  who  is  seen 
teaching  the  children  in  the  villages  to  read  and  write 
in  the  sand ;  the  calendar  Bramin,  or  astrologer,  who 
proclaims  the  lucky  or  unpropitious  periods  for  sow- 
ing and  threshing;  the  smith  and  carpenter,  who  manu- 
facture the  implements  of  agriculture  and  build  the 
dwelling  of  the  Ryot;  the  potman,  or  potter;  the 
zvasherman ;  the  barber;  the  cowkeeper,  who  looks  after 
the  cattle ;  the  doctor;  the  dancing-girl,  who  attends 
at  rejoicings ;  the  musician,  and  the  poet.  These  offi- 
cers and  servants  generally  constitute  the  establish- 
— T  ment  of  a  village ;  but  in  some  parts  of  the  country 
it  is  of  less  extent,  some  of  the  duties  and  functions 
above  described  being  united  in  the  same  person ;  in 
others  it  exceeds  the  number  of  individuals  which 
have  been  described. 

"  Under  this  simple  form  of  municipal  government 
the  inhabitants  of  the  country  have  lived  from  time 
immemorial.  The  boundaries  of  villages  have  been 
but  seldom  altered,  and  though  the  villages  themselves 
have  been  sometimes  injured,  and  even  desolated,  by 
war,  famine,  and  disease,  the  same  name,  the  same 
limits,  the  same  interests,  and  even  the  same  families 

^  have  continued  for  ages.  The  inhabitants  give  them- 
selves no  trouble  about  the  breaking  up  and  divisions 
of  kingdoms ;  while  the  village  remains  entire,  they 
care  not  to  what  power  it  is  transferred  or  to  what 
sovereign   it   devolves ;   its   internal   economy   remains 

""^^  unchanged;  the  Potail  is  still  the  head  inhabitant,  and 
still  acts  as  the  petty  judge  and  magistrate  and  col- 
lector or  renter  of  the  village." 

These  village  communities  were  not  confined  to  the 
South.     They  existed  more  or  less  all  through  India, 


AGRICULTURE  205 

North,  South,  East  and  West.  They  have  now  van- 
ished, though  in  some  places  the  name  is  still  kept  up. ' 
The  substance,  however,  is  gone,  perhaps  never  again 
to  appear.  The  causes  that  have  operated  to  bring 
about  the  result  have  been  stated  by  Mr.  R.  C.  Dutt 
as  follows: 

"  Two  causes,  however,  operated  from  the  com- 
mencement of  the  British  rule  to  weaken  the  old  village 
communities.  An  extreme  anxiety  to  enhance  the 
land  revenue  to  its  very  utmost  limits  induced  the 
administrators  to  make  direct  arrangements  with  every 
individual  cultivator.  An  equally  unreasonable  anxi- 
ety to  centralise  all  judicial  and  executive  powers  in 
their  own  hands  led  the  modern  rulers  to  virtually  set 
aside  those  village  functionaries  who  had  so  long  ex- 
ercised these  powers  within  the  limits  of  their  own 
villages.  Deprived  of  their  functions,  the  village  com- 
munities rapidly  fell  into  decay,  and  the  Indian  ad- 
ministration of  the  present  day,  better  organised  in 
many  respects  than  the  administration  of  the  past, 
suffers  from  this  disadvantage,  that  it  is  more  auto- 
cratic, and  rests  in  a  far  less  degree  on  the  co-opera- 
tion of  the  people  themselves." 

The  history  of  the  Zemindari  settlements  in  the 
Northern  Circars  (Madras)  may  be  stated  in  a  few 
words.  These  lands  were  settled  with  Zemindars  until 
1778 ;  then  Sir  Thomas  Rumbold  made  a  five-years' 
settlement.  In  1783  the  practice  of  annual  settle- 
ments was  resumed  and  continued  until  1786,  when  a 
three-years'  settlement  was  concluded  on  an  increased 
revenue  demand.  In  1789  a  settlement  for  three  and 
eventually  for  five  years  was  concluded,  and  the  Zemin- 
dars were  assessed  at  tzvo-thirds  of  their  gross  collec- 
tions.    For  the  lands  not  occupied  by  the  Zemindar 


2o6  ENGLAND'S  DEBT  TO  INDIA 

was  adopted  the  system  which  has  since  become  known 
as  the  Ryotwari  system.  So  far  back  as  1787  two  dif- 
ferent methods  were  adopted  for  collecting  the  revenue 
due  on  these  lands.  "  In  some  places  they  collected  it 
directly  from  the  cultivators  in  kind  by  taking  a  share 
of  the  produce  as  the  Government  revenue ;  and  in 
other  places  they  farmed  out  the  lands  for  stipulated 
sums."  The  principle  of  the  system  was  "  dealing 
direct  with  the  cultivator."  As  other  parts  of  the  coun- 
try came  into  the  possession  of  the  Company,  the  prin- 
ciple of  settling  directly  with  individual  cultivators  was 
made  universal  and  the  rights  of  all  middlemen  were 
swept  away.  The  one  name  which  is  indelibly  written 
on  the  Land  Administration  of  the  Madras  Presidency 
is  that  of  Thomas  Munro,  who  afterwards  rose  to  the 
Governorship  of  the  Presidency  under  the  title  of  Sir 
Thomas  Munro.  His  assessments  were  fairly  mod- 
erate. In  no  instance,  said  he,  in  one  of  his  letters  of 
October  7,  1800,  was  the  Government  share  "  more 
than  one-third.  In  many  it  was  not  more  than  one- 
fifth  or  one-sixth,  and  in  some  not  more  than  one-tenth 
of  the  gross  produce."  ^^  Even  under  those  moderate 
assessments  he  showed  an  increase  of  50  per  cent.,  i.e., 
from  i402,637  to  £606,909,  within  seven  years.  From 
the  context  of  a  letter  published  by  Mr,  Dutt  in  his 
book  "  Early  History  of  British  Rule "  (page  126) 
it  appears  that  but  for  fear  of  being  overruled  by  the 
Directors  Munro's  assessments  should  have  been  even 
more  moderate.  He  had  before  him  the  example  of  a 
friend    "  who   was    about   to   be    removed    from    the 

^3  The  share  of  Government  under  the  Hindus  varied  from 
M.0  to  Yc  but  never  exceeded  that  amount. 


AGRICULTURE  207 

service  because  he  had  made  assessments  which  the 
Board  of  Revenue  liad  considered  too  low  "  (page 
127). 

While  Munro  was  making  the  Ryotwari  settlements 
in  districts  not  held  by  Zemindars,  steps  were  taken  in 
the  latter  by  which  it  was  attempted  to  oust  the  propri- 
etors from  their  holdings.  The  Zemindars,  called  the 
Polygars,  revolted  and  had  to  be  punished.  In  addi- 
tion to  the  death  sentences  passed  on  some  of  the  reb- 
els, their  lands  were  confiscated  and  subjected  to  Ryot- 
wari settlement.  With  fourteen  of  these  Southern 
Polygars  permanent  settlement  was  made  in  1803. 
The  revenues  fixed  varied  from  41  per  cent,  to  57  per 
cent,  of  the  gross  rental.  Similar  settlements  were 
made  with  the  Polygars  in  Sivaganga  and  Ramnad. 
Permanent  settlements  were  also  made  with  the  West- 
ern Polygars  in  1802.  But  the  Polygars  of  Chitoor 
were  mostly  expelled  from  their  estates  as  a  punish- 
ment for  having  resisted  British  claims  by  show  of 
force. 

The  policy  of  Lord  Wellesley  was  to  "  obtain  for 
Government  the  utmost  that  the  land  will  yield  in  the 
shape  of  rent."  ^*  The  Ryotwari  system  was  found  to 
be  most  favourable  to  this  object  and  was  almost  uni- 
versally adopted.  The  greatest  champion  of  the  sys- 
tem was  Thomas  Munro  who  had  settled  several  dis- 
tricts on  those  principles  and  had  recommended  the 
universal  adoption  of  them  for  the  rest  of  the  coun- 
try. Before  his  departure  for  Europe  in  1807  he  made 
a  report  recommending  a  Ryotwari  settlement  for  the 

1*  Henry  St.  George  Tucker,  "  Memorials  of  Indian  Govern- 
ment, London,  1853,"  p.  113. 


2o8  ENGLAND'S  DEBT  TO  INDIA 

ceded  Districts  adding  (a)  that  the  assessment  should 
be  permanent  and  that  (b)  *'  the  exorbitant  revenue 
he  had  raised,"  ^^  viz.,  45  per  cent,  of  the  gross  prod- 
uce, be  reduced  by  a  quarter. 

Munro's  recommendation  of  a  permanent  Ryotwari 
settlement  was  confirmed  by  Lord  William  Bentinck, 
the  then  Governor  of  Madras,  and  six  years  later  when 
Munro  was  examined  by  the  Committee  of  the  House 
of  Commons,  in  connection  with  the  renewal  of  the 
East  India  Company's  Charter  in  1813,  he  repeated  his 
views  most  forcibly.  In  the  meantime  the  Board  of 
Revenue  at  Madras  had  started  another  idea,  viz.,  that 
of  a  permanent  village  settlement,  which  differed  from 
both  the  Bengal  Zemindari  settlements  and  Munro's 
Ryotwari  settlements  in  so  far  as  the  settlement  w-as 
to  be  made  neither  with  individual  landlords  nor  with 
individual  cultivators  but  with  each  village  community 
as  a  unit.  The  Board  of  Revenue  also  supported 
Munro's  recommendation  for  a  reduction  of  25  per 
cent,  in  the  government  demand.  The  recommenda- 
tions of  the  Board  of  Revenue  w^ere  accepted  by  the 
Government  of  Madras,  which  authorised  the  "  con- 
clusion of  triennial  village  settlements  as  a  preparatory 
measure  to  the  introduction  of  a  permanent  village  set- 
tlement." ^^  And  on  the  expiration  of  these  triennial 
settlements  they  proposed  to  the  Court  of  Directors  the 
conclusion  of  a  decennial  settlement  to  become  perma- 
nent if  approved  by  the  Directors.^'^ 

15  R.  C.  Dutt,  "  India  Under  Early  British  Rule,"  p.  135. 

^'^  Letters  of  the  Government  of  Madras  of  25th  May,  1808, 
quoted  by  R.  C.  Dutt  in  his  "  India  Under  Early  British  Rule," 
p.  142. 

17  Letter  of  the  29th  February,  1812,  quoted  by  R.  C.  Dutt 
in  his  "  India  Under  Early  British  Rule,"  p.  142. 


AGRICULTURE  209 

The  Directors,  however,  refused  to  sanction  the  ele- 
ment of  permanancy.  The  Government  of  Madras 
made  two  different  appeals  to  the  Court  of  Directors 
in  favour  of  a  permanent  settlement,  but  in  vain.  We 
give  the  following  quotations  from  these  dispatches : 

"  That  agriculture  was  regarded  as  the  basis  of  na- 
tional wealth  and  prosperity;  that  it  was  considered 
essential  to  the  improvement  and  extension  of  agricul- 
ture to  restrict  the  demands  of  Government  upon 
landed  property;  that  it  was  not  supposed  Govern- 
ment could  lose  by  this  restriction,  since  without  it 
agriculture  would  never  be  improved  and  extended, 
nor  the  resources  of  the  country  increased.  ...  In 
offering  the  foregoing  remarks,  we  have  considered 
the  Permanent  Settlement  strictly  as  a  question  of 
fiscal  policy.  But  it  does  not  need  to  be  shown  that 
it  is  of  vital  importance  also,  as  being  calculated  to 
give  to  the  mass  of  the  people,  who  are  engaged  in 
agriculture,  a  deep  and  permanent  interest  in  the  sta- 
bility of  our  Government."  ^^ 

In  the  following  year,  the  Government  of  Madras 
made  a  still  more  eloquent  appeal  to  the  Court  of  Di- 
rectors in  favour  of  permanent  village  settlements  and 
against  permanent  Ryotwari  settlements. 

"  If  the  primary  object  of  a  Permanent  Settlement 
be  to  give  the  people  the  management  of  their  own 
affairs,  from  the  belief  that  their  affairs  will  be  in- 
definitely managed  by  themselves  than  by  public  offi- 
cers, how  little  would  that  object  be  attained  under 
such  a  system  (the  Ryotwari  system)  ?  How  entirely 
would  all  management  still  remain  in  those  hands  from 
which  it  was  meant  to  transfer  it.  It  is  singular  that, 
under  such  a  system,  professedly  designed  to  protect 

18  Letter  dated  5th  March,  1813. 


210  ENGLAND'S  DEBT  TO  INDIA 

the  rights  and  interests  of  landed  proprietors,  they 
are  to  forfeit  all  property  in  any  land  which  through 
general  or  peculiar  calamity  or  indolence  or  misman- 
agement, they  may  any  year  fail  to  cultivate,  and  their 
property  in  it  is,  on  every  such  occurrence,  to  escheat 
to  the  Government ;  assuredly  a  more  violent  encroach- 
ment on  landed  property,  where  it  really  exists,  than 
ever  was  attempted  under  any  other  system.  .  .  . 

"  He  (the  cultivator)  is  not  secure  against  a  fraudu- 
lent measurement  on  the  estimation  of  the  land  he  quits 
or  the  land  he  occupies ;  nay,  if  to  escape  from  the 
mode  of  oppression  he  resolves  not  to  alter  his  limits, 
the  current  business  of  agriculture,  the  means  of  irriga- 
tion, the  distribution  of  Tuccavy,  or  of  an  abatement 
of  rent  on  account  of  calamity,  all  must  be  regulated 
by  men  who  have  no  interest  in  his  property,  no  sym- 
pathy with  his  feelings.  Surely  it  were  better  that 
confidence  should  be  reposed  where  self-interest  af- 
fords a  security  against  its  being  abused,  and  that  the 
people  should  be  left  to  improve  the  country  in  their 
own  way,  without  the  encumbrance  of  useless  and  ill- 
judged  aid  from  public  officers,  and  without  the  dread 
of  their  oppression  and  rapacity.  At  any  rate,  we 
own  that  the  Ryotwari  system,  proposed  by  Colonel 
Munro,  seems  to  us  in  no  respect  to  deserve  the  name 
of  a  Permanent  Settlement  of  the  land  revenue,  but, 
on  the  contrary,  to  leave  land  revenue  and  landed  prop- 
erty as  unsettled  as  ever,  and  the  people  liable  to  all 
that  prying,  meddling  interference  of  public  officers 
imder  which  no  private  concern  can  prosper.  .  .  . 

"  The  grand  difference  between  the  view  at  present 
taken  in  England  regarding  Indian  land  revenue  and 
that  taken  here,  seems  to  be,  that  in  England  the  fear 
is  that  the  public  demands  upon  the  resources  of  In- 
dia may  not  keep  pace  with  its  prosperity ;  while  here 
the  universal  sentiment,  we  believe  without  any  ex- 
ception whatever,  is,  that  the  prosperity  of  the  coun- 
try is  so  much  depressed  by  the  public  demands,  that, 
without  the  most  liberal  and  judicious  management, 


AGRICULTURE  211 

there  is  more  danger  of  its  resources  declining  than 
room  to  hope  for  their  speedy  increase.  This  is  a  sen- 
timent which  we  cannot  too  strongly  convey  to  your 
Honourable  Court.  It  is  addressed  to  your  wisdom, 
to  your  sense  of  justice,  to  your  humanity;  it  concerns 
the  successful  administration  of  your  Government  no 
less  than  the  welfare  and  happiness  of  a  numerous 
population  and  the  prosperity  of  an  extensive  country, 
favoured  by  nature,  protected  from  internal  commotion 
and  foreign  assault,  and  requiring  only  moderation  in 
the  demands  of  Government  upon  its  resources  to 
render  it  rich  and  flourishing.  Compared  with  the  at- 
tainment of  these  great  ends,  of  how  little  value  ap- 
pears every  sacrifice  which  can  be  made  for  them  ?  "  ^^ 

In  1818,  the  Board  of  Revenue  repeated  its  views 
on  the  desirability  of  a  permanent  village  settlement  in 
a  minute  which  R.  C.  Dutt  calls  "  one  of  the  most  ex- 
haustive and  memorable  minutes  ever  written  in  India  " 
and  from  which  we  make  the  following  extracts : 

"  The  ancient  Zemindars  and  Polygars  were,  in  fact, 
the  nobility  of  the  country,  and  though  the  origin  of 
some  of  their  tenures  would  not  bear  too  minute  a 
scrutiny,  they  were  connected  with  the  people  by  ties 
which  it  was  more  politic,  more  liberal,  and  more 
just  to  strengthen  than  to  dissolve.  Had  our  power 
in  the  Circars  been  as  strong  on  the  acquisition  of  these 
provinces  as  it  subsequently  became  at  the  period  of 
the  transfer  of  the  Ceded  Districts,  the  ancient  Zemin- 
dars, like  the  Polygars  of  the  latter  country,  might 
perhaps  have  been  removed  from  their  lands  and  re- 
duced to  the  situation  of  mere  pensioners  on  our 
bounty ;  but  when  the  attachment  of  the  people  to  their 
native  chieftains  and  the  local  situation  of  many  Zem- 

"  Letter  dated  12th  August,  1814. 


212  ENGLAND'S  DEBT  TO  INDIA 

indaris  are  considered,  it  may  be  greatly  doubted 
whether  such  a  policy  would  not  have  been  as  unwise 
as  it  would  have  been  ungenerous. 

"  In  the  Northern  Division  of  Arcot,  all  these  su- 
periorities (special  rights  of  Mirasdars  or  hereditary 
peasant  proprietors)  were  also  resumed  and  incorpor- 
ated with  the  public  revenue.  In  short,  the  survey 
assessment  was  raised  so  high  as  to  absorb  in  the  Gov- 
ernment revenue  any  little  rent  remaining  to  the  land- 
holders. No  intermediate  person  was  acknowledged 
between  the  State  and  the  actual  cultivator.  .  .  . 

"  The  Ryotwari  settlement,  in  fact,  was  made  an- 
nually, frequently  by  the  Tehsildars  and  Sheristadars 
(subordinate  low-paid  officers),  and  was  not  in  gen- 
eral concluded  until  after  the  crop  had  been  raised ;  the 
system  then  was  to  make  as  high  a  settlement  as  it 
was  practicable  to  realise.  If  the  crop  was  good,  the 
demand  was  raised  as  high  within  the  survey  rates  as 
the  means  of  the  Ryots  would  admit;  if  the  crop  was 
bad,  the  last  farthing  was  notwithstanding  demanded, 
and  no  remission  was  allowed  unless  the  Ryot  was 
totally  unable  to  pay  the  rent.  On  this  point  the  most 
severe  scrutiny  was  instituted,  for  not  only  was  the 
whole  of  the  Collector's  detailed  establishment  of  serv- 
ants employed  in  an  investigation  of  his  means,  but 
each  of  his  neighbours  were  converted  into  inquisitors 
by  being  themselves  made  liable  for  his  failure  unless 
they  could  show  that  he  was  possessed  of  prop- 
erty. .  .  . 

"  He  (the  cultivator)  was  constrained  to  occupy  all 
such  fields  as  were  allotted  to  him  by  the  revenue  offi- 


AGRICULTURE  213 

cers,  and  whether  he  cultivated  them  or  not,  he  was,  as 
Mr.  Thackery  emphatically  terms  it,  saddled  with  the 
rent  of  each.  To  use  the  words  of  Mr.  Chaplin,  the 
Collector  in  Bellary,  one  of  the  most  able  of  Colonel 
Munro's  former  assistants,  and  still  one  of  the  most 
strenuous  advocates  of  the  Ryotwari  system,  it  was  the 
custom  under  it,  '  to  exert  in  a  great  degree  the  au- 
thority, which  is  incompatible  with  the  existing  regula- 
tions, of  compelling  the  inhabitants  to  cultivate  a 
quantity  of  ground  proportionate  to  their  circum- 
stances.' This  he  explains  to  have  been  done  by  '  the 
power  to  confine  and  punish  them,'  exercised  by  the 
Collector  and  his  native  revenue  servants ;  and  he  ex- 
pressly adds,  that  if  the  Ryot  was  driven  by  these  op- 
pressions from  the  fields  which  he  tilled,  it  was  the 
established  practice  '  to  follow  the  fugitive  wherever 
he  went,  and  by  assessing  him  at  discretion,  to  deprive 
him  of  all  advantage  he  might  expect  to  derive  from  a 
change  of  residence.' 

"  Ignorant  of  the  true  resources  of  the  newly-ac- 
quired countries,  as  of  the  precise  nature  of  their 
landed  tenures,  we  find  a  small  band  of  foreign  con- 
querors no  sooner  obtaining  possession  of  a  vast  ex- 
tent of  territory,  peopled  by  various  nations,  differing 
from  each  other  in  language,  customs,  and  habits,  than 
they  attempt  what  would  be  called  a  Herculean  task, 
or  rather  a  visionary  project  even  in  the  most  civilised 
countries  of  Europe,  of  which  every  statistical  in- 
formation is  possessed,  and  of  which  the  Government 
are  one  with  the  people,  viz.,  to  fix  a  land-rent,  not  on 
each  province,  district  or  country,  not  on  each  estate 
or  farm,  but  on  every  separate  field  within  their  do- 


214  ENGLAND'S  DEBT  TO  INDIA 

minions.  In  pursuit  of  this  supposed  improvement, 
we  find  them  unintentionally  dissolving  the  ancient  ties, 
the  ancient  usages  which  united  the  republic  of  each 
Hindu  village,  and  by  a  kind  of  agrarian  law,  newly 
assessing  and  parceling  out  the  lands  which  from  time 
immemorial  had  belonged  to  the  Village  Community 
collectively,  not  only  among  the  individual  members 
of  the  privileged  order  (Mirasdars  and  Kadeems),  but 
even  among  the  inferior  tenantry  (Pykaris),  we  ob- 
serve them  ignorantly  denying,  and  by  their  denial 
abolishing  private  property  in  the  land,  resuming  what 
belonged  to  a  public  body  (the  Gramamanium),  and 
conferring  in  lieu  of  it  a  stipend  in  money  on  one  in- 
dividual; professing  to  limit  their  demand  to  each 
field,  but  in  fact,  by  establishing  such  limit,  an  unat- 
tainable maximum,  assessing  the  Ryot  at  discretion, 
and,  like  the  Mussulman  Government  which  preceded 
them,  binding  the  Ryot  by  force  to  the  plough,  com- 
pelling him  to  till  the  land  acknowledged  to  be  over- 
assessed,  dragging  him  back  to  it  if  he  absconded,  de- 
ferring their  demand  upon  him  until  his  crop  came  to 
maturity,  then  taking  from  him  all  that  could  be  ob- 
tained, and  leaving  him  nothing  but  his  bullocks  and 
seed  grain,  nay,  perhaps  obliged  to  supply  him  even 
with  these,  in  order  to  renew  his  melancholy  task  of 
cultivating,  not  for  himself,  but  for  them." 

The  village  system  advocated  by  the  Board  of  Reve- 
nue was  rejected,  but  what  pains  the  student  of  Indian 
History  is  that  the  permanency  of  the  assessments, 
recognised  and  admitted  by  the  Madras  Government 
down  to   1862  in  accordance  with  the  promises  and 


AGRICULTURE  215 

declarations  of  Sir  Thomas  Munro,  has  since  been  ig- 
nored and  the  Government  demand  is  being  altered  at 
each  recurring  settlement,  which  leaves  the  agricultural 
population  of  Madras  in  a  state  of  perpetual  uncer- 
tainty and  chronic  poverty. 

Sir  Thomas  Munro  returned  to  Madras  as  Governor 
in  May,  1820,  and  the  Ryotwari  system  was  generally 
introduced  in  the  same  month.  All  opportunities  were 
seized  of  acquiring  Zemindaris  and  breaking  up  vil- 
lage tenures  through  the  high  rate  of  assessments  by 
which  the  state  demand  was  fixed  at  45  per  cent,  or 
50  or  55  per  cent,  of  the  field  produce.  ...  In  the  Ad- 
ministration report  of  Madras  for  1855-56,  it  was 
stated  that  "  the  Ryot  cannot  be  ejected  by  Government 
so  long  as  he  pays  the  fixed  assessment.  The  Ryot 
under  the  system  is  virtually  a  proprietor  on  a  simple 
and  perfect  title,  and  has  all  the  benefits  of  a  perpetual 
lease."  In  1857  the  Board  of  Revenue  said  that  "  a 
Madras  Ryot  is  able  to  retain  land  perpetually  without 
an  increase  of  assessment.  In  1862  the  Government 
of  Madras  wrote  to  the  Government  of  India  that 
"  there  can  be  no  question  that  one  fundamental  prin- 
ciple of  the  Ryotwari  system  is  that  the  government 
demand  on  the  land  is  fixed  for  ever."  (Letter  of 
February  18,  1862.)  Yet  none  of  these  declarations 
and  assurances  availed  the  Madras  Ryot.  Since  1855 
he  has  had  "  no  fixity  of  rental  and  no  security  against 
enhancement."  In  1858,  on  the  transference  of  the 
administration  of  India  from  the  East  India  Company 
to  the  Crown,  Lord  Halifax  laid  down  the  policy  of 
the  Government  in  the  matter  of  land  tax.     He  fixed 


2i6  ENGLAND'S  DEBT  TO  INDIA 

it  at  half  of  the  rent,  but  in  practice,  says  R.  C.  Dutt, 
the  land  tax  in  Madras  sweeps  away  the  whole  of  the 
economic  rent,  particularly  in  small  holdings. 

Northern  India.  Turning  to  Northern  India  we  find 
the  same  story  of  over-assessments  and  broken  pledges. 
Benares  was  permanently  annexed  in  1795  by  Lord 
Cornwallis. 

Six  years  after,  the  Nawab  of  Oudh  was  compelled 
by  a  series  of  unjust  coercive  measures,  fully  noted  by 
James  Mill  in  his  "  History  of  British  India,"  to  cede  to 
the  East  India  Company  "  more  than  one-half  and  not 
much  less  than  two-thirds  "  of  his  territory.  These 
districts  were  settled  under  orders  of  Henry  Wellesley, 
the  brother  of  the  Governor  General.  That  they  were 
over-assessed  has  been  practically  admitted  by  Henry 
Wellesley  himself,  who  in  his  work  called  "  Papers  Re- 
lating to  East  India  Affairs,"  has  said  that  although 
he  "  was  still  apprehensive  "  that  the  settlement  had 
been  made  upon  an  erroneous  calculation  of  the  exist- 
ing assets  of  the  country  and  that  the  amount  would  be 
with  difficulty  realised,  he  "  determined  not  to  annul 
the  enforcements  which  had  been  recently  concluded 
by  the  collectors  from  an  apprehension  that  any  imme- 
diate interference  on  my  part  might  tend  to  weaken 
their  authority, —  which  at  that  critical  period  it  ap- 
peared to  him  so  necessary  to  support."  The  senti- 
ments expressed  in  this  extract  furnish  the  keynote  of 
British  policy  in  India.  If  the  "  man  on  the  spot "  errs 
on  the  side  of  the  Government  he  is  to  be  supported  ;  if 
he  errs  on  the  side  of  the  people,  he  is  to  be  investigated 
and  overruled.  The  following  figures  taken  from  the 
statement  appended  to  the  report  of  Henry  Wellesley 


AGRICULTURE  217 

show  the  increase  in  the  revenue  made  by  the  British : 

Amount  of  the  Nabob's  land  Revenue  Assessment  £13,523,474 

British  assessment  of  the  first  year 15,619,627 

British  assessment  of  the  second  year 16,162,786 

British  assessment  of  the  third  year 16,823,063 

In  1803  a  Regulation  was  enacted  (XXV  of  1803) 
recognising  the  triennial  settlement  of  the  land  revenue 
already  made,  and  notifying  that,  at  the  expiration  of 
that  term,  another  settlement  would  be  made  for  three 
years,  to  be  followed  by  a  settlement  for  four  years, 
at  the  expiration  of  which  a  permanent  settlement 
would  be  concluded. 

"  In  these  terms,"  says  the  Select  Committee  of  the 
House  of' Commons  in  their  report  of  1812  (Fifth  Re- 
port, page  51),  "  the  Supreme  Government  pledged  it- 
self to  the  land  holders  for  the  introduction  of  a  Per- 
manent Settlement "  at  the  expiration  of  an  aggregate 
of  ten  years  from  the  first  settlement  of  Henry  Wel- 
lesley. 

In  1803  and  1805  first  conquests  were  made  in 
Northern  India  and  practically  the  whole  country  be- 
tween the  Jumna  and  the  Ganges  now  known  as  the 
United  Province  of  Agra  and  Oudh  with  the  excep- 
tion of  parts  of  Oudh  that  remained  with  the  Nabob 
till  Dalhousie  made  short  business  of  him,  came  under 
British  sway.  The  Regulations  recently  introduced  in 
the  Ceded  Districts  of  Oudh  were  introduced  into  the 
"  Conquered  Provinces  "  also  and  "  the  same  pledge 
which  had  been  given  to  the  land  holders  of  the  former 
country  "  about  the  permanency  of  the  settlement  after 
ten  years  "  was  given  in  the  latter.  .  .  .  Two  years 
later  the  pledge  was  repeated,  but  with  the  proviso 


2i8  ENGLAND'S  DEBT  TO  INDIA 

that  the  conclusion  of  the  permanent  settlement  would 
depend  on  the  confirmation  of  the  Court  of  Di- 
rectors." 20 

Then  came  the  famous  discussions  on  the  question  of 
a  permanent  settlement  in  Northern  India ;  the  Special 
Commissioners  R.  W.  Cox  and  Henry  St.  George 
Tucker  submitted  their  report,  "  admitting  the  benefits 
of  a  Permanent  Settlement,  but  declaring  themselves 
adverse  to  the  immediate  conclusion  of  such  a  settle- 
ment in  the  Ceded  and  the  Conquered  Provinces."  -^ 

The  arguments  of  the  Special  Commissioners  were 
replied  to  by  H.  Clebrooke,  who  said : 

"  3.  Government  is  pledged,  by  the  proclamations  of 
the  4th  July,  1802  and  nth  July,  1805,  to  conclude  a 
Permanent  Settlement  with  the  landholders,  at  the 
expiration  of  the  periods  there  specified,  for  such  lands 
as  may  be  in  a  sufficiently  improved  state  of  cultiva- 
tion to  warrant  the  measure,  on  fair  and  equitable 
terms.  It  was  judged  expedient,  on  full  considera- 
tion of  the  subject,  and  with  ample  knowledge  of  the 
circumstances  now  alleged,  to  anticipate  these  periods ; 
and  accordingly,  in  June,  1807,  the  Governor-General 
in  Council  notified  to  the  Zemindars  and  other  pro- 
prietors, by  Regulation  X.,  1807,  that  the  Jumma 
assessed  for  the  last  year  of  the  ensuing  settlement 
shall  remain  fixed  for  ever,  if  they  be  willing  to  en- 
gage, and  the  arrangement  shall  receive  the  sanction 
of  the  Court  of  Directors. 

"  4.  The  pledge  which  has  thus  been  solemnly  con- 
tracted cannot  be  forfeited  without  such  a  glaring  vio- 
lation of  promise  as  would  lose  us  deservedly  the  con- 
fidence of  the  people.  .  .  . 

"  9.  The  argument  on  which,  if  I  mistake  not,  the 

20  Regulation  X  of  1807. 

21  R.  C.  Dutt,  "  India  Under  Early  British  Rule,"  p.  178. 


AGRICULTURE  219 

late  Commissioners  chiefly  rely,  is  that  the  right  of  par- 
ticipating in  future  improvement  ought  not  to  be  re- 
linquished, because  Government  is  in  a  manner  the  land- 
holder and  proprietor  of  a  vast  estate.  .  .  . 

"  26.  Upon  the  important  occasions  of  the  Perma- 
nent Settlement  of  Bengal  and  Behar,  and  of  the 
territories  on  the  coast  of  Coromandel,  and  after 
mature  deliberation,  a  claim  of  participation  in  the 
future  improvement  of  the  waste  lands  was  relin- 
quished to  a  greater  extent  than  the  proportion  at 
which  they  are  computed  by  the  late  Board  of  Com- 
missioners  in   the   Ceded   and   Conquered   Provinces. 

"  27.  The  happy  result  of  the  measure  is  now  wit- 
nessed in  Bengal.  The  reviving  prosperity  of  the 
country,  its  increased  wealth  and  rapid  improvement, 
are  unquestionably  due  to  the  Permanent  Settlement, 
the  principle  of  which  was  so  wise  that  even  the  seri- 
ous errors  that  were  committed  in  filling  up  the  out- 
line of  the  plan  could  not  ultimately  disappoint  its 
views.  .  .  . 

"  32.  I  appeal  to  this  experience  in  preference  to 
any  speculative  argument.  ...  It  was  expected  that 
the  improvement  of  estates  by  the  culture  of  waste 
lands  would  enrich  the  landholder  by  the  increase  of 
his  usual  income,  and  enable  him  to  meet  the  varia- 
tions of  seasons  and  temporary  calamities  of  drought 
and  inundation  without  needing  remissions  of  revenue. 

"  33.  These  expectations  have  been  realised.  .  .  . 

"  38.  It  appears  to  be  a  very  prevalent  opinion  that 
the  British  system  of  administration  is  not  generally 
palatable  to  our  Indian  subjects.  Admitting  this  opin- 
ion to  be  not  unfounded,  it  follows  that  while  they 
taste  none  but  the  unpalatable  parts  of  the  system, 
and  while  the  only  boon  which  would  be  acceptable 
to  them  is  withheld,  the  landed  proprietors  and  with 
them  the  body  of  the  people,  must  be  more  and  more 
estranged  from  the  Government,  in  proportion  to  the 
expectations  which  they  formed,  and  the  disappoint- 
ment which  they  will  have  experienced.  .  .  . 


220  ENGLAND'S  DEBT  TO  INDIA 

"  6^.  I  shall  conclude  by  declaring  my  concurrence 
in  the  Commissioners'  recommendation,  that  steadi- 
ness, moderation  and  justice  should  be  the  features 
borne  by  the  administration  of  Government.  But  it  is 
not  by  abandoning  a  measure  deliberately  resolved  on, 
and  beneficial  to  our  subjects,  that  we  shall  prove  our 
steadiness.  It  is  not  by  grasping  at  the  highest 
revenue  and  wringing  from  our  peasants  the  utmost 
rent,  that  we  shall  evince  our  moderation;  nor  is  it 
by  depriving  the  sons  of  our  petty  landholders  of  their 
birthright  that  we  shall  demonstrate  our  sense  of  jus- 
tice."    (Colebrook's  minute  of  1808.) 

Lord  Minto,  then  Governor-General,  supported  H. 
Colebrook  and  said  that  on  a  mature  consideration  of 
all  the  documents  connected  with  the  establishment  of 
a  Permanent  Settlement  in  the  provinces  of  Bengal, 
Behar,  Orissa,  and  Benares,  and  in  the  territories  de- 
pendent on  the  Presidency  of  Fort  St.  George,  and  of 
all  the  reports  and  minutes  respecting  the  proposed 
Permanent  Settlement  in  the  Ceded  and  Conquered 
Provinces,  he  was  entirely  satisfied  of  the  sound  pol- 
icy, or  rather  of  the  urgent  necessity,  of  the  measure. 
(Letter  dated  September  15,  1808.) 

The  Directors,  however,  had  made  up  their  minds. 
They  replied : 

"  No  settlement  shall  be  declared  permanent  in  Cut- 
tack  or  in  any  other  of  our  Provinces  till  the  whole 
proceedings  preparatory  to  it  have  been  submitted  to 
us,  and  till  your  resolutions  upon  these  proceedings 
have  received  our  sanction  and  concurrence." 

Nine  months  after,  they  again  wrote  that  "  the  ob- 
ject of  the  present  despatch  is  to  caution  you  in  the 
most  pointed  manner  against  pledging  us  to  the  ex- 
tension of  the  Bengal  fixed  assessment  to  our  newly 


AGRICULTURE  221 

acquired    territories."     (Despatch    of    ist    February, 
181 1,  and  27th  November,  181 1.) 

The  Government  of  India  naturally  resented  this 
and  pointed  out  that  the  pledges  given  in  the  Regu- 
lations of  1803  and  1805  and  the  Proclamation  v^hich 
formed  a  part  of  Section  29  of  Regulation  XXV  of 
1803  were  unconditional;  that  these  pledges  had  been 
given  by  the  responsible  servants  and  agents  of  the 
company  and  were  therefore  binding  on  them.  "  Had 
the  Honourable  Court's  dissent,"  wrote  the  Indian 
Government,  "  to  the  arrangements  established  by  the 
Regulations  of  1803  and  1805  been  signified  at  an 
early  period  after  the  enaction  of  those  regulations, 
the  inherent  powers  of  control  possessed  by  the  court 
might  have  been  urged  in  support  of  such  dissent,  al- 
though those  regulations  contained  no  reserve  of  the 
court's  approval;  but  now  that  the  whole  term  of  the 
contract  has  expired  in  the  ceded  provinces,  and  two- 
thirds  of  it  in  the  conquered  countries,  the  annulment 
of  it,  at  this  distant  period,  could  not,  we  apprehend, 
as  already  intimated,  be  reconciled  to  the  dictates 
either  of  policy  or  justice."  ^^ 

Lord  Minto,  in  a  minute  recorded  by  himself,  en- 
deavoured to  construe  the  directors'  recent  orders  in  a 
restricted  sense,  as  he  could  not  reconcile  a  literal  con- 
struction of  those  orders  "  with  the  maintenance  of  the 
faith  of  government  so  publicly  and  so  solemnly 
pledged  to  the  landlords."  ^^ 

One  more  protest  was  submitted  by  Lord  Minto 
against  the  directors'  orders  before  he  left  India  in 

22  Letter  dated  gth  October,  1812. 

23  Minute  dated  nth  July,  1812. 


222  ENGLAND'S  DEBT  TO  INDIA 

1813.  He  pointed  out  that  a  permanent  settlement 
involved  no  sacrifice  of  revenues ;  that  a  variable  land- 
tax  had  been  condemned  even  by  Adam  Smith  in  his 
"  Wealth  of  Nations,"  as  a  discouragement  to  improve- 
ments in  land ;  that  a  permanent  settlement  could  be 
effected  for  the  estates  actually  held  by  the  landlords 
in  Northern  India  vi^ithout  including  the  waste  lands ; 
and  finally  if  the  object  of  good  government  was  "  to 
ameliorate  generally  the  conditions  of  the  natives,  it  is 
our  firm  conviction  that  no  arrangement  or  measure 
will  tend  so  speedily  and  effectually  to  the  accomplish- 
ment of  those  important  objects  as  the  establishment 
of  a  permanent  settlement."  2* 

But  the  directors  of  the  company  were  obdurate. 
Their  professed  desire  for  the  good  of  the  people  of 
India  would  not  move  them  to  surrender  their  own 
profits.  They  had  indeed  fixed  upon  a  plan  of  get- 
ting out  of  the  pledges  given  in  1803  and  1805.  They 
suggested  an  evasion  which  would  not  be  held  valid 
by  any  court  of  justice,  and  which  was  unworthy  of 
honest  merchants,  not  to  speak  of  the  rulers  of  an 
empire. 

"  Continued  possession  and  a  punctual  discharge  of 
the  dues  of  government  during  the  triennial  leases 
formed  only  one  part  of  the  condition  on  which  gov- 
ernment pledged  itself  to  a  permanent  settlement  with 
the  landholders.  There  was  another  and  still  more 
important  clause  in  the  condition,  viz.,  that  the  land 
should,  in  the  interval,  be  brought  to  a  sufficiently  ad- 
vanced stage  of  cultivation  to  warrant  us  in  fixing 
perpetual  limits  to  our  demand  upon  it.     The  precise 

2*  Letter  dated   17th  July,  1813. 


AGRICULTURE  223 

point  of  improvement  at  which  such  a  measure  might 
become  expedient,  or  even  justifiable,  was  not  deter- 
mined by  the  Regulation  of  1803  and  1805,  and  would 
not,  indeed,  be  determined  by  any  prospective  Regula- 
tion. The  question  was  left  completely  open  for  the 
future  exercise  of  the  judgment  of  Government;  nor 
is  there  anything  in  these  Regulations  by  which  its 
decision  can,  or  ought  to  be,  in  the  smallest  degree 
fettered."  ^^  No  Permanent  Settlements  were  made 
in  any  estates  in  1813,  nor  have  any  been  made  since, 
which  shows  that  the  argument  was  only  a  subterfuge 
to  evade  a  solemn  pledge. 

Repeated  efforts  were  made  by  responsible  English 
officers  to  secure  a  Permanent  Settlement  for  the 
Ceded  and  the  Conquered  Provinces  in  accordance  with 
the  pledge  mentioned  above,  but  the  Directors  re- 
mained obdurate. 

All  these  efforts  failed  and  the  policy  of  the  Gov- 
ernment as  to  land  tax  was  embodied  in  Regulation 
VII  of  1822.  The  settlements  were  to  be  revised  pe- 
riodically. In  estates  held  by  superior  landlords  the 
assessments  were  to  be  so  regulated  as  to  leave  the 
landlord  a  net  profit  of  20  per  cent  of  the  Government 
demand.  When  the  lands  were  held  by  cultivators  in 
common  tenancy  the  State  demand  might  be  raised  to 
95  per  cent  of  the  rents.  In  actual  practice  it  came  to 
"  over  83  per  cent "  in  one  case  and  to  practically  the 
whole  of  the  economic  rent  in  another.^® 

25  Letter  dated  i6th  March,  1813. 

20  In  this  connection  it  will  be  interesting  to  read  the  fol- 
lowing extracts  from  a  minute  of  Sir  Charles  Metcalfe  about 
the  nature  of  Indian  Village  Communities. 

"  The   Village    Communities    are    little    Republics,    having 


224  ENGLAND'S  DEBT  TO  INDIA 

The  system  introduced  by  Regulation  VII  of  1822 
was  found  to  be  impracticable  and  oppressive.  It 
"  broke  down  ultimately  by  reason  of  its  own  harsh- 
ness." A  new  policy  was  laid  down  by  Regulation  IX 
of  1833,  by  which  the  Government  demand  was  re- 

nearly  ever)^hing  that  they  want  within  themselves,  and  al- 
most independent  of  any  foreign  relations.  They  seem  to  last 
where  nothing  else  lasts.  Dynasty  after  dj'nasty  tumbles 
down ;  revolution  succeeds  to  revolution ;  Hindu,  Pathan, 
Moghal,  Mahratta,  Sikh,  English,  are  masters  in  turn ;  but 
the  Village  Communities  remain  the  same.  In  times  of 
trouble  they  arm  and  fortify  themselves ;  a  hostile  army  passes 
through  the  country;  the  Village  Community  collect  their 
cattle  within  their  walls,  and  let  the  enemy  pass  unprovoked. 
If  plunder  and  devastation  be  directed  against  themselves  and 
the  force  employed  be  irresistible,  they  flee  to  friendly  vil- 
lages at  a  distance,  but  when  the  storm  has  passed  over  thej"^ 
return  and  resume  their  occupations.  If  a  country  remain  for 
a  series  of  years  the  scene  of  continued  pillage  and  massacre, 
so  that  the  villages  cannot  be  inhabited,  the  scattered  villagers 
nevertheless  return  whenever  the  power  of  peaceable  posses- 
sion revives.  A  generation  may  pass  away,  but  the  succeeding 
generation  will  return.  The  sons  will  take  the  places  of 
their  fathers,  the  same  site  for  the  village,  the  same  position 
for  the  houses,  the  same  lands,  will  be  reoccupied  by  the  de- 
scendants of  those  who  were  driven  out  when  the  village  vvas 
depopulated;  and  it  is  not  a  trifling  matter  that  will  drive 
them  out,  for  they  will  often  maintain  their  post  through 
times  of  disturbance  and  convulsion,  and  acquire  strength  suf- 
ficient to  resist  pillage  and  oppression  with  success. 

"  The  union  of  the  Village  Communities,  each  one  forming 
a  separate  State  in  itself,  has,  I  conceive,  contributed  more 
than  any  other  cause  to  the  preservation  of  the  people  of 
India  through  all  revolutions  and  changes  which  they  have 
suffered,  and  it  is  in  a  high  degree  conducive  to  their  happi- 
ness and  to  the  enjoyment  of  a  great  portion  of  freedom  and 
independence.  I  wish,  therefore,  that  the  Village  Constitu- 
tions may  never  be  disturbed,  and  I  dread  everything  that  has 
a  tendency  to  break  them  up.  I  am  fearful  that  a  Revenue 
Settlement  with  each  individual  cultivator,  as  is  the  practice 
in  the  Ryotwari  Settlement,  instead  of  one  with  the  Village 
Community  through  their  representatives,  the  headmen,  might 
have  such  a  tendency.  For  this  reason,  and  for  this  only,  I  do 
not  desire  to  see  the  Ryotwari  Settlement  generally  introduced 
into  the  Western  Provinces." 


AGRICULTURE  225 

"duced  to  two-thirds  of  the  gross  rental  and  the  settle- 
ments were  made  for  thirty  years.  In  accordance  with 
the  Regulation,  settlements  were  made  by  a  "  very  just 
and  humane  officer  "  of  the  name  of  Robert  Bird,  but 
so  high  was  the  Government  demand  that  numerous 
villages  were  deserted  by  the  peasants  and  vast  tracts 
of  the  country  became  waste  until  the  Government 
felt  bound  to  reduce  the  Government  share  to  50  per 
cent,  of  the  net  rental  in  1855.  This  continues  the 
basis  on  which  settlements  are  now  made  in  Northern 
India. 

Bombay.  To  complete  the  story  of  the  development 
of  the  land  tax  in  India,  we  have  to  state  what  was 
done  in  the  Bombay  Presidency.  Bombay  was  more 
fortunate  than  the  other  provinces,  in  so  far  as  the 
administration  of  its  affairs  and  the  settlement  of  the 
country,  after  its  annexation  in  1817,  were  entrusted 
to  a  man  noted  for  his  broad  sympathies  and  states- 
manlike desire  to  promote  the  prosperity  of  the  people 
put  in  his  charge.  This  man  was  Mountstuart  Elphin- 
stone  (afterward  Sir  Mountstuart  Elphinstone,  author 
of  a  monumental  history  of  early  and  Moslem  India). 

Elphinstone's  "  Report  on  the  Territories  Conquered 
from  the  Peshwas,"  submitted  to  the  Governor-Gen- 
eral in  October,  1819,  is  a  masterly  account  of  the 
country  as  it  was  then,  and  of  the  measures  adopted 
for  its  settlement  by  the  British.  From  it  we  make 
the  following  extracts : 

Village  Communities.  "  In  whatever  point  of  view 
we  examine  the  Native  Government  in  the  Deccan, 
the  first  and  most  important  feature  is,  the  division 
into  villages  or  townships.     These  Communities  con- 


226  ENGLAND'S  DEBT  TO  INDIA 

tain  in  miniature  all  the  materials  of  a  State  within 
themselves,  and  are  almost  sufficient  to  protect  their 
members,  if  all  other  governments  are  withdrawn. 
Though  probably  not  compatible  with  a  very  good 
form  of  Government,  they  are  an  excellent  remedy  for 
the  imperfections  of  a  bad  one;  they  prevent  the  bad 
effects  of  its  negligence  and  weakness,  and  even  present 
some  barrier  against  its  tyranny  and  rapacity. 

"  Each  village  has  a  portion  of  ground  attached  to 
it,  which  is  committed  to  the  management  of  the  inhab- 
itants. The  boundaries  are  carefully  marked  and 
jealously  guarded.  They  are  divided  into  fields,  the 
limits  of  which  are  exactly  known;  each  field  has  a 
name  and  is  kept  distinct,  even  when  the  cultivation  of 
it  has  long  been  abandoned.  The  villagers  are  almost 
entirely  cultivators  of  the  ground,  with  the  addition  of 
the  few  traders  and  artisans  that  are  required  to  sup- 
ply their  wants.  The  head  of  each  village  is  the  Patil, 
who  has  under  him  an  assistant,  called  a  Chaugulla, 
and  a  clerk  called  a  Kulkarni.  There  are,  besides, 
twelve  village  officers  well  known  by  the  name  of 
Bara  Baloti.  These  are  the  astrologer,  the  priest,  the 
carpenter,  barber,  etc.,  but  the  only  ones  who  are  con- 
cerned in  the  administration  of  the  government  are  the 
Sonar  or  Potdar,  who  is  silversmith  and  assayer  of 
money,  and  the  Mhar,  who,  in  addition  to  various  other 
important  duties,  acts  as  watchman  to  the  village. 
Each  of  these  classes  consists  of  one  or  more  indi- 
viduals, according  as  their  original  families  have 
branched  out.  The  Mhars  are  seldom  fewer  than  four 
or  five,  and  there  are  besides,  where  those  tribes  are 
numerous,  very  frequently  several  Phils  or  Ramoshis, 


AGRICULTURE  227 

employed  also  as  watchmen,  but  performing  none  of 
the  other  duties  of  the  Mhar. 

"  The  Patils  are  the  most  important  functionaries  in 
the  villages,  and  perhaps  the  most  important  class  in- 
the  country.  They  hold  office  by  a  grant  from  the 
Government  (generally  from  that  of  the  Moguls),  are 
entitled  by  virtue  of  it  to  land  and  fees,  and  have 
various  little  privileges  and  distinctions,  of  which  they 
are  as  tenacious  as  of  their  land.  Their  office  and 
emoluments  are  hereditary,  and  saleable  with  the  con- 
sent of  the  Government,  but  are  seldom  sold,  except 
in  cases  of  extreme  necessity,  though  a  partner  is 
sometimes  admitted,  with  a  careful  reservation  of  the 
superiority  of  the  old  possessor.  The  Patil  is  head 
of  the  police  and  of  the  administration  of  justice  in 
his  village,  but  he  need  only  be  mentioned  here  as  an 
officer  of  revenue.  In  that  capacity  he  performs  on  a 
small  scale  what  a  Mamlatdar  or  a  Collector  does  on  a 
large;  he  allots  the  land  to  such  cultivators  as  have 
no  landed  property  of  their  own,  and  fixes  the  rent 
which  each  has  to  pay;  he  collects  the  revenue  for 
Government  from  all  the  Rayats;  conducts  all  its  ar- 
rangements with  them,  and  exerts  himself  to  promote 
the  cultivation  and  the  prosperity  of  the  village. 
Though  originally  the  agent  of  the  Government,  he  is 
now  regarded  as  equally  the  representative  of  the  Ra- 
yats, and  is  not  less  useful  in  executing  the  orders  of 
the  Government  than  in  asserting  the  rights,  or  at 
least  in  making  known  the  wrongs  of  the  people. 

"  A  large  portion  of  the  Rayats  are  the  proprietors 
of  their  estates,  subject  to  the  payment  of  a  fixed  land 
tax  to  Government;  their  property  is  hereditary  and 


228  ENGLAND'S  DEBT  TO  INDIA 

saleable,  and  they  are  never  dispossessed  while  they 
pay  their  tax,  and  even  then  they  have  for  a  long 
period  (at  least  thirty  years)  the  right  of  reclaiming 
their  estate  on  paying  the  dues  of  Government. 
Their  land  tax  is  fixed,  but  the  late  Mahratta  Govern- 
ment loaded  it  with  other  impositions,  which  reduced 
that  advantage  to  a  mere  name;  yet  so  far,  however, 
was  this  from  destroying  the  value  of  their  estates, 
that  although  the  Government  took  advantage  of  their 
attachment  to  make  them  pay  considerably  more  than 
an  Upri,  and  though  all  the  Mirasdars  were  in  ordi- 
nary cases  obliged  to  make  up  for  failures  in  the  pay- 
ment of  each  of  their  body,  yet  their  lands  were  sale- 
able, and  generally  at  ten  years'  purchase.  .  .  . 

"  An  opinion  prevails  throughout  the  Mahratta  coun- 
try, that  under  the  old  Hindu  Government  all  the  land 
was  held  by  Mirasis,  and  that  the  Upris  were  intro- 
duced as  the  old  proprietors  sank  under  the  tyranny 
of  the  Mohammedans.  This  opinion  is  supported  by 
the  fact  that  the  greater  part  of  the  fields  now  culti- 
vated by  Upris  are  recorded  in  the  village  books  as  be- 
longing to  absent  proprietors ;  and  affords,  when  com- 
bined with  circumstances  observed  in  other  parts  of 
the  peninsula,  and  with  the  light  Land  Tax  authorised 
by  Manu,  a  strong  presumption  that  the  revenue  sys- 
tem under  the  Hindus  (if  they  had  a  uniform  system) 
was  founded  on  private  property  in  the  soil." 

Changes  Under  the  British  Rule.  "  The  outline  of 
the  revenue  system  adopted  since  our  acquisition  of  the 
country  is  contained  in  my  letter  dated  July  loth,  con- 
veying instructions  to  the  Collectors,  and  in  that  dated 
July  14th,  enclosing  instructions  for  Mamlatdars.    The 


AGRICULTURE  229 

leading  principles  are  to  abolish  farming,  but  otherwise 
to  maintain  the  native  system ;  to  levy  the  revenue  ac- 
cording to  the  actual  cultivation,  to  make  the  assess- 
ment light,  to  impose  no  new  taxes,  and  to  do  none 
away  unless  obviously  unjust;  and,  above  all,  to  make 
no  innovations.  Many  innovations  were,  however,  the 
result  of  the  introduction  of  foreign  rulers  and  foreign 
maxims  of  government ;  but  in  the  revenue  department 
most  of  them  were  beneficial."  .  .  .  Then  follow  cer- 
tain detailed  recommendations  which  Elphinstone  made 
for  the  future  administration  of  the  country.  In  con- 
clusion he  said : 

"  But  with  all  these  defects,  the  Mahratta  country 
flourished,  and  the  people  seem  to  have  been  exempt 
from  some  of  the  evils  which  exist  imder  our  more 
perfect  Government.  There  must,  therefore,  have 
been  some  advantages  in  the  system  to  counterbalance 
its  obvious  defects,  and  most  of  them  appear  to  me  to 
have  originated  in  one  fact,  that  the  Government,  al- 
though it  did  little  to  obtain  justice  for  the  people,  left 
them  the  means  of  procuring  it  for  themselves.  The 
advantage  of  this  was  particularly  felt  among  the  lower 
orders,  who  are  most  out  of  reach  of  their  rulers,  and 
most  apt  to  be  neglected  under  all  Governments.  By 
means  of  the  Panchayat,  they  were  enabled  to  effect 
a  tolerable  dispensation  of  justice  among  themselves; 
and  it  happens  that  most  of  the  objections  above  stated 
to  that  institution  do  not  apply  in  their  case.  .  .  . 

"  I  propose,  therefore,  that  the  native  system  should 
still  be  preserved,  and  means  taken  to  remove  its  abuses 
and  revive  its  energy.  Such  a  course  will  be  more 
welcome  to  the  natives  than  any  entire  change,  and 


230  ENGLAND'S  DEBT  TO  INDIA 

if  it  should  fail  entirely,  it  is  never  too  late  to  intro- 
duce the  Adalat.  .  .  . 

"  Our  principal  instrument  must  continue  to  be  the 
Panchayat,  and  that  must  continue  to  be  exempt  from 
all  new  forms,  interference,  and  regulation  on  our 
part." 

We  have  given  these  long  extracts  as  they  contain 
the  most  valuable  testimony  regarding  the  institutions 
of  the  country  in  pre-British  days  and  furnish  incon- 
testable material  for  comparison. 

But  even  Elphinstone  was  unable  to  override  or  de- 
pose the  greed  of  his  masters,  the  Directors  of  the 
East  India  Company.  In  reviewing  the  settlement  as- 
sessments of  the  territories  under  his  Governorship  he 
had  on  several  occasions  expressed  his  concern  at  the 
rapid  growth  of  revenue,  and  the  only  thing  he  could 
do  was  to  approve  of  Mr.  Chaplin's  decision  to  fix  it  at 
one-third  the  gross  product. 

We  have  a  piece  of  valuable  evidence  on  the  aspects 
of  this  system  of  taxation  left  on  record  by  the  dis- 
tinguished English  divine,  Bishop  Heber,  who  toured 
India,  1824-26.  In  his  letter  to  the  Right  Honourable 
Charles  Williams  Wynn,  dated  Karnatic,  March,  1826, 
he  said : 

"  Neither  Native  nor  European  agriculturist,  I  think, 
can  thrive  at  the  present  rate  of  taxation.  Half  the 
gross  produce  of  the  soil  is  demanded  by  Govern- 
ment, and  this,  which  is  nearly  the  average  rate  wher- 
ever there  is  not  a  Permanent  Settlement,  is  sadly  too 
much  to  leave  an  adequate  provision  for  the  present, 
even  with  the  usual  frugal  habits  of  the  Indians,  and 
the  very  inartificial  and  cheap  manner  in  which  they 


AGRICULTURE  231 

cultivate  the  land.  Still  more  is  it  an  effective  bar 
to  anything  like  improvement ;  it  keeps  the  people,  even 
in  favourable  years,  in  a  state  of  abject  penury;  and 
when  the  crop  fails  in  even  a  slight  degree,  it  involves  a 
necessity  on  the  part  of  the  Government  of  enormous 
outlays  in  the  way  of  remission  and  distribution,  which, 
after  all,  do  not  prevent  men,  women,  and  children 
dying  in  the  streets  in  droves,  and  the  roads  being 
strewed  with  carcasses.  In  Bengal,  where,  indepen- 
dent of  its  exuberant  fertility,  there  is  a  Permanent 
Assessment,  famine  is  unknown.  In  Hindustan 
(Northern  India)  on  the  other  hand,  I  found  a  general 
feeling  among  the  King's  officers,  and  I  myself  was  led 
from  some  circumstances  to  agree  with  them,  that  the 
peasantry  in  the  Company's  Provinces  are,  on  the 
whole,  worse  off,  poorer,  and  more  dispirited,  than  the 
subjects  of  the  Native  Princes;  and  here  in  Madras, 
where  the  soil  is,  generally  speaking,  poor,  the  differ- 
ence is  said  to  be  still  more  marked.  The  fact  is,  no 
Native  Prince  demands  the  rent  which  we  do,  and 
making  every  allowance  for  the  superior  regularity  of 
our  system,  etc.,  /  met  with  very  few  men  who  will 
not,  in  coniidence,  own  their  belief  that  the  people  are 
over-taxed,  and  that  the  country  is  in  a  gradual  state 
of  impoverishment.  The  Collectors  do  not  like  to 
make  this  avowal  officially.  Indeed,  now  and  then,  a 
very  able  Collector  succeeds  in  lowering  the  rate  to  the 
people,  while  by  diligence  he  increases  it  to  the  State. 
But,  in  general,  all  gloomy  pictures  are  avoided  by 
them  as  reflecting  on  themselves,  and  drawing  on  them 
censure  from  the  Secretaries  at  Madras  or  Calcutta, 
while  these,  in  their  turn,  plead  the  earnestness  with 


232  ENGLAND'S  DEBT  TO  INDIA 

which  the  Directors  at  home  press  for  more  money. 

"  I  am  convinced  that  it  is  only  necessary  to  draw 
less  money  from  the  peasants,  and  to  spend  more  of 
what  is  drawn  within  the  country,  to  open  some  door 
to  Indian  industry  in  Europe,  and  to  admit  the  natives 
to  some  greater  share  in  the  magistracy  of  their  own 
people,  to  make  the  Empire  as  durable  as  it  would  be 
happy."  ^^ 

With  this  might  be  read  the  following  answers  given 
by  Mr.  Robert  Richards,  a  retired  Anglo-Indian  officer, 
to  the  questions  put  to  him  by  the  Committee  of  the 
House  of  Commons  in  an  enquiry  on  the  subject. 

"  Where  the  revenue  is  collected,  as  it  is  in  India, 
on  the  principle  of  the  Government  being  entitled  to 
one-half  of  the  gross  produce  of  the  soil,  and  vast 
numbers  of  officers,  whose  acts  it  is  impossible  to 
control,  are  also  employed  in  the  realisation  of  this 
revenue,  it  is  a  moral  impossibility  for  any  people 
whatever  to  live  or  prosper  so  as  to  admit  of  a  very 
extensive  commercial  intercourse  being  carried  on  with 
them.  .  .  . 

"  It  may  be  done  (i.e.  manufacture  of  articles  for 
foreign  exportation)  in  lands  not  subject  to  the  afore- 
mentioned exorbitant  tax.  It  may  also  be  the  case 
in  Bengal,  where  the  Permanent  Settlement  has  been 
enforced  for  many  years,  and  where  its  original  ruin- 
ous pressure  is  no  longer  so  severely  felt ;  but  it  would 
be  quite  impossible  in  lands,  for  example,  subject  to 
the  Ryotwari  Tax,  or  from  lands  where  from  45  per 
cent,  to  50  per  cent,  of  the  gross  produce  is  actually 
levied  as  revenue. 

"  I  am  personally  acquainted  with  instances  where 
the  revenue  assessed  upon  certain  lands  has  actually 

27  Bishop  Heber's  "  Memoirs  and  Correspondence,"  by  his 
Widow,  London,  1830,  Vol.  II,  p.  413.    The  italics  are  our  own. 


AGRICULTURE  ^33 

exceeded  the  gross  produce.  I  have  also  known  other 
lands  in  India  where  a  revenue  has  been  assessed  as 
being  specifically  derivable  from  rice  lands,  planta- 
tions of  fruit  trees,  pepper,  vines,  and  other  articles, 
and  each  portion  particularly  described;  but  on  com- 
paring the  assessment  with  the  lands  in  question,  those 
very  lands  have  been  found  to  have  been  nothing  but 
jungle  within  the  memory  of  man." 

The  whole  subject  has  been  exhaustively  discussed 
by  Lieutenant-Colonel  Briggs  in  a  book  of  500  pages  ^ 
called  "The  Present  Land  Tax  in  India"  (London, 
1838),  in  which  he  points  out  that  among  ancient  na-  ~^ 
tions  —  the  Greeks,  the  Romans,  the  Persians  and  the 
Chinese,  the  right  of  the  State  consisted  in  levying  a 
tax  of  a  tenth  of  the  produce.  Among  the  Hindus  the 
right  of  the  King  was  to  a  levy  of  one-eighth,  one- 
sixth,  or  one-twelfth  of  the  produce  according  to 
the  nature  of  the  soil  and  the  expense  of  cultivation. 
We  make  no  apology  for  making  the  following  quota- 
tion'from  page  108  of  his  book: 


"  The  flourishing  condition  of  the  country  under 
the  Moghal  Emperors  is  recorded  by  all  European 
travellers  who  have  visited  the  East  within  the  last 
three  centuries;  and  the  wealth,  the  population,  and 
the  national  prosperity  of  India,  far  surpassing  what 
they  had  seen  in  Europe,  filled  them  with  astonish- 
ment. That  the  condition  of  the  people  and  the  coun- 
try under  our  Government  presents  no  such  spectacle, 
is  every  day  proclaimed  by  ourselves,  and  we  may 
therefore  assume  it  to  be  true.  .  .  . 

"  If  I  have  proved  that  we  have  departed  from  the 
practice  of  our  predecessors,  that  we  have  established 
a  system  far  exceeding  theirs  in  rigour,  even  in  the 
worst  of  their  regular  governments,  then  indeed  there 


^ 


234  ENGLAND'S  DEBT  TO  INDIA 

is  some  reason  to  call  for  a  reform,  and  to  hope  at 
least  for  investigation.  ,  .  . 

"  I  conscientiously  believe  that  under  no  Govern- 
ment whatever,  Hindu  or  Mohommedan,  professing  to 
be  actuated  by  law,  was  any  system  so  subversive  of 
the  prosperity  of  the  people  at  large  as  that  which  has 
marked  our  administration.  .  .  . 

"  Although  we  have  everywhere  confessed  that  the 
heavy  pressure  of  taxation  was  the  most  cruel  injury 
they  sustained,  we  have  in  no  instance  alleviated  that 
pressure.  So  far  from  it,  we  have  applied  a  false 
measure  for  fixing  the  impost,  that  of  money  instead 
of  produce;  we  have  pretended  to  abolish  minor  taxes 
on  other  classes,  but  we  have  laid  the  amount  on  the 
landholder;  and  by  minute  scrutiny  into  every  indi- 
vidual's concerns,  have,  under  the  plea  of  justice  to 
ourselves,  in  many  instances  deprived  the  cultivators 
of  the  means  they  enjoyed  of  paying  the  heavy  taxes 
from  which  they  sought  relief  under  us,  till  by  rigid 
exactions  we  have  increased  our  own  revenue  and  re- 
duced the  people  to  the  condition  of  mere  labourers. 
This  is  the  professed  maxim  of  our  rule,  the  certain 
and  inevitable  result  of  taking  the  whole  surplus  profit 
of  land.  .  .  . 

"  Having  assumed  that  the  Government  is  the  sole 
landlord,  it  (the  present  Government),  considers  the 
land  to  be  the  most  profitable  source  of  all  revenue; 
it  employs  a  host  of  public  servants  to  superintend  the 
cultivator;  and  it  professes  to  take  all  the  profit.  A 
Land-Tax  like  that  which  now  exists  in  India,  pro- 
fessing to  absorb  the  whole  of  the  landlord's  rent,  was 
never  known  under  any  Government  in  Europe  or 
Asia." 

The  results  of  the  settlements  in  the  Bombay  Presi- 
dency in  1824-28  are  thus  stated  in  the  official  language 
of  the  Bombay  Administration  Report  of  1872-73 
(page  41). 


AGRICULTURE  235 

"  From  the  outset  it  was  found  impossible  to  collect 
anything  approaching  to  the  full  revenue.  In  some 
districts  not  one-half  could  be  realised.  Things  now 
went  rapidly  from  bad  to  worse.  Every  year  brought 
its  addition  to  the  accumulated  arrears  of  revenue,  and 
the  necessity  for  remission  or  modification  of  rates. 
.  .  .  Every  effort,  lawful  and  unlawful,  was  made  to 
get  the  utmost  out  of  the  wretched  peasantry,  who 
were  subjected  to  torture,  in  some  instances,  cruel  and 
revolting  beyond  all  description,  if  they  would  not  or 
could  not  yield  what  was  demanded.  Numbers  aban- 
doned their  homes,  and  fled  into  the  neighbouring 
Native  States.  Large  tracts  of  land  were  thrown  out 
of  cultivation,  and  in  some  districts  no  more  than  a 
third  of  the  cultivable  area  remained  in  occupation." 

It  is  no  wonder  that  the  system  had  to  be  abandoned 
and  was  replaced  by  another  inaugurated  by  the  joint 
report  of  Messrs.  Goldsmid,  Wingate  and  Davidson 
in  1847,  which  established  the  principle  of  the  sepa- 
rate assessment  of  each  field  as  distinguished  from  a 
holding  or  a  village,  for  a  fixed  term  of  30  years  on 
the  basis  of  the  estimated  value  of  lands.  The  Bom- 
bay settlements  are  now  made  on  these  principles. 

The  Punjab.  The  Punjab,  which  is  said  to  be  the 
granary  of  India,  was  annexed  to  the  British  domin- 
ions, part  by  Lord  Hardinge  in  1846  and  the  rest  of  it 
by  Lord  Dalhousie  in  1849. 

How  the  British  came  into  conflict  with  the  Sikhs  in 
the  Punjab,  after  the  strong  hand  of  Maharajah 
Ranjit  Singh  was  removed  from  the  control  of  its  af- 
fairs by  his  death  in  1839;  how  bravely  the  Sikhs 
fought;  how  they  were  betrayed  by  the  treachery  of 
their  own  leaders  and  how  Lord  Hardinge  decided  to 
annex  a  part  of  the  province,  leaving  the  rest  under 


2z6  ENGLAND'S  DEBT  TO  INDIA 

the  sovereignty  of  the  minor  son  of  Ranjit  Singh,  to 
be  administered  during  his  minority  by  a  council  of 
regency  appointed  by  him  and  under  the  guidance  of  a 
British  Resident  with  practically  unlimited  powers,  are 
matters  which  belong  to  the  domain  of  political  his- 
tory and  are  outside  the  scope  of  this  book.  So  are 
all  the  subsequent  events  w^hich  led  to  the  second  Sikh 
War  and  the  annexation  of  the  Punjab  by  Lord  Dal- 
housie,  in  spite  of  the  protests  made  by  Henry  Law- 
rence, the  British  resident  at  the  Court  of  the  minor 
Maharaja  of  the  Punjab  and  many  others,  who  ar- 
gued that  having  assumed  the  guardianship  of  the 
person  and  the  property  of  the  minor  Maharaja  by  a 
treaty  solemnly  entered  into  between  the  British  Gov- 
ernment and  the  three  guardians  of  the  Maharaja  in 
1846,  the  British  Government  could  not  by  any  rule  of 
law,  or  of  justice,  equity  and  good  conscience,  deprive 
the  Maharaja  of  his  dominions,  simply  because  the 
Sikh  army  or  some  of  the  subordinate  leaders  of  the 
Punjab  had  revolted  against  the  authority  of  the  Brit- 
ish. Lord  Dalhousie  knew  of  no  law  but  that  of 
Empire-making.  The  map  of  British  India  was  in- 
complete without  the  Punjab,  so  he  annexed  the  prov- 
ince and  his  masters  in  England  approved  his  decision. 
There  is  an  authentic  official  record  of  the  condition 
of  the  Punjab,  at  the  time  of  the  annexation,  in  the 
first  administrative  report  of  the  province,  compiled 
by  Mr.  (afterwards  Sir)  Richard  Temple,  under  the 
instructions  of  the  Lawrence  brothers,  afterwards 
known  as  Sir  Henry  and  Lord  John  Lawrence. 

This  report  shows  that  the  Sikh  rule  fully  recog- 
nised private  property  in  land  and  although  the  taxa- 


AGRICULTURE  237 

tion  was  heavy  yet  "  in  some  respects  the  Government 
gave  back  with  one  hand  what  it  had  taken  with  the 
other."  We  are  told  that  the  land  tax  under  Mahajara 
Ran  jit  Singh  was  in  theory  assumed  to  be  one-half  of 
the  gross  produce,  but  in  practice  "  may  be  said  to 
have  varied  from  two-fifths  to  one-third  of  the  gross 
produce."  It  was  raised  not  in  money  but  in  kind 
and  it  was  therefore,  says  R.  C.  Dutt,  proportionate 
to  the  produce  of  the  fields  in  good  years  as  well  as 
in  bad  years.  Under  such  a  system  cultivators  were 
not  called  upon  to  pay  a  fixed  and  immutable  sum 
when  their  harvest  had  failed ;  nor  were  they  required 
in  years  of  low  prices  to  pay  a  revenue,  calculated  on 
the  basis  of  high  prices.^^ 

John  Lawrence,  the  first  Chief  Commissioner  of  the 
Punjab  after  annexation,  was  a  kind-hearted  ruler, 
sympathetic  to  the  people,  and  his  instructions  were 
contained  in  the  following  sentence  which  occurs  in 
one  of  his  letters  to  Nicholson:  "  Assess  low,  leaving 
fair  and  liberal  margin  to  the  occupiers  of  the  soil  and 
they  will  increase  their  cultivation  and  put  the  revenue 
almost  beyond  the  reach  of  bad  seasons."  But  the  ac- 
tual assessments  were  not  low.  Mr.  S.  S.  Thorburn, 
ex-commissioner  in  the  Punjab,  has  said  that  the  first 
effect  of  the  British  occupation  of  the  Punjab  was 
over-assessment  (Digby's  "  Prosperous  British  India," 
footnote  on  p.  91).  In  1847-48  the  Land  Revenue 
of  the  Punjab  was  £820,000.     Within  three  years  of 

28  Much  light  has  been  thrown  on  Ran  jit  Singh's  Land  as- 
sessments and  his  anxiety  for  the  welfare  of  his  subjects  by 
recent  researches  made  by  a  Punjabi  Hindu  scholar  of  the 
name  of  Sita  Ram,  a  graduate  of  the  Punjab  University, 
Lahore. 


238  ENGLAND'S  DEBT  TO  INDIA 

the  British  annexation  it  went  up  to  £1,060,000.^* 
"  There  has  been  a  general  demand,"  says  the  Punjab 
report  for  1852,  "  among  the  agriculturists  for  a  re- 
turn to  grain  payments, —  to  a  division  or  appraise- 
ment of  the  crops  every  season."  The  figures  for 
1856-57  and  1857-58  show  a  considerable  increase  in 
revenue  as  compared  with  the  figures  for  1852. 

Demanded      Collections 

1856-57    £1,485,000        £1,452,000 

1857-58    £1,465,000        £1452,000 

In  the  regular  settlements  started  in  i860,  one-sixth 
of  the  produce  was  demanded  as  the  land  revenue,  but 
by  later  rules  framed  under  the  Land  Revenue  Act  of 
1871  the  Government  limited  its  demand  to  one-half 
of  the  actual  rents  paid  by  ordinary  tenants-at-will 
in  average  years,  in  accordance  with  the  policy  de- 
termined upon  in  connection  with  the  then  North- 
western Provinces.  In  theory,  that  is  the  principle  on 
which  the  land  tax  is  assessed  in  the  Punjab  now. 
Additions  to  It  have  been  made  in  the  shape  of  water- 
rates  and  various  cesses  for  roads,  police,  education, 
etc.,  etc.  The  story  of  these  cesses  has  been  very  ef- 
fectively told  by  Mr.  Thorburn,  I.  C.  S.  (a  retired 
Financial  Commissioner  of  the  Punjab)  in  his  book 
called  "  The  Punjab  in  Peace  and  War,"  London,  1904. 
When  the  Government  decided  to  establish  a  Famine 
Insurance  Fund  every  province  was  required  to  con- 
tribute. Mr.  Thorburn  gives  a  picture  of  how  the 
Punjab  quota  was  raised.  Says  he:  "In  the  eyes 
of  the  Punjab  Government,  the  peasantry  were  the 
class  to  be  squeezed,  they  being  *  prosperous,'  lightly 

2»Dutt;  "India  in  the  Victorian  Age"  (1906),  p.  90. 


AGRICULTURE  239 

assessed,  accustomed  to  bear  burdens  without  murmur- 
ing and  prospectively  the  chief  beneficiaries  from  the 
tax.  The  sum  wanted  was  i  120,000  each  year.  To 
enhance  the  land  revenue  pro  tanto  would  have  been 
simple  but  illegal."  So  "  the  legal  difficulty  was  sur- 
mounted by  calling  the  enhancements  a  '  cess.'  Ac- 
cordingly an  additional  local  rate  cess  of  6  per  cent, 
on  the  land  revenue  was  legalised  and  levied."  (Page 
236.) 

Central  Provinces.  The  story  of  the  development 
of  the  land  tax  in  the  Central  Provinces  is  very  similar 
to  that  of  the  other  provinces.  Immediately  after  the 
annexation  of  the  different  parts,  enormous  increases 
in  the  land  tax  were  the  features  of  the  British  as- 
sessment. For  example,  in  the  Hoshangabad  and 
Leonee  districts  "  the  assessment  fixed  by  Major  Mac- 
pherson  in  1821  was  £10,359  from  an  area  which  had 
been  assessed  by  the  Mahratta  Government  at  £2,277 
only."  In  1825  it  was  still  further  increased  to  £13,877. 
This  enormous  demand  could  not  be  realised  and  re- 
missions had  to  be  made,^°  which  "  were  not  sufficient 
and  very  strenuous  eflforts  were  made  to  collect  the 
revenue  by  any  means,  so  that  to  this  day,  a  most 
lively  recollection  of  the  tortures  and  cruelties  then 
suffered  lives  in  the  minds  of  the  Zemindars."  (Set- 
tlement Report  of  Hoshangabad,  1855,  ^Y  Charles 
Elliot,  paragraph  50.)  At  last  in  1836  a  twenty-year 
settlement  was  made  at  a  reduced  assessment  of  £6,192. 

In  the  settlement  of  the  Sagor  by  Col.  Maclean 
(1867)  we  find  the  following  remarks :  "  The  Govern- 
ment demands  press  so  heavily  upon  the  people  that  all 

80 R.  C.  Dutt,  "India  in  the  Victorian  Age"  (1904),  P-  292. 


240  ENGLAND'S  DEBT  TO  INDIA 

enterprise  has  been  crushed,  and  there  is  not  the 
slightest  attempt  at  improvement.  I  have  personally 
satisfied  myself  that  in  many  instances  the  Govern- 
ment demand  exceeds  the  gross  rental  assets  of  some 
villages. 

"  The  people  have  lost  heart  to  that  extent  that  in 
some  instances  the  rightful  owners  of  hereditary  de- 
scent refused  on  any  terms  to  accept  the  proprietary 
rights  of  villages. 

"  The  impressions  conveyed  to  me  on  inspecting  these 
tracts  was  that  the  people  were  dead,  so  vast  was  the 
desolation,  and  so  scarce  the  signs  of  life  or  of  human 
beings."  (Settlement  report  of  Sagar,  by  Colonel 
Maclean  in  1867.)  It  is  needless  to  add  that  this  state 
of  things  was  strongly  condemned  by  the  Government 
of  India  and  new  settlements  were  made  in  1863-67. 
The  principle  of  one-half  of  the  rental  of  states  as 
government  revenue,  was  adopted,  but  the  actual  re- 
sults in  some  cases  exceeded  that  proportion  (see  a 
table  given  by  Mr.  R.  C.  Dutt  on  page  30  of  his  book 
called  "  India  in  the  Victorian  Age,"  which  he  takes 
from  a  letter  of  the  Chief  Commissioner  to  the  Gov- 
ernor-General of  India,  No.  1862  of  April  11,  1901). 

The  Present  Policy  as  to  the  Land  Tax.  The  more 
recent  history  of  the  question  and  the  controversy  on 
the  subject  have  been  summed  up  by  Mr.  R.  C.  Dutt  in 
a  chapter  headed  "  The  Land  Resolutions  of  Lords 
Ripon  and  Curzon,"  in  his  book  "  India  in  the  Victorian 
Age."  This  chapter  is  a  fair  summary  of  the  case  on 
both  sides  and  gives  ample  quotations  from  the  orig- 
inals. The  general  principle  is  that  the  Government 
demand  is  fixed  at  50  per  cent,  of  the  rental  and  the 


AGRICULTURE  241 

settlement  is  made  for  twenty  to  thirty  years.  For 
the  effect  of  this  poHcy  on  the  economic  condition  of 
the  population  of  India  depending  on  agriculture  and 
comprising  nine-tenths  of  the  whole,  the  reader  is  re- 
ferred to  the  next  chapter. 

The  general  Government  position  on  the  subject  has 
been  given  by  us  in  the  earlier  part  of  this  chapter  from 
the  Blue  Book  for  1913-14,  viz.,  the  statement  show- 
ing the  moral  and  material  progress  of  India. 

A  Summary  of  Land  Revenue  Receipts  from  1861 
to  1913-14. 

Land  Revenue  Receipts, 
excluding  receipts  due 
to  irrigation 

Land  Revenue 

Receipts 

£ 

1881-1885  (5  years' average)    13,287,000 

1866-70  "  13,227,000 

1871-75  " 13,977.000 

1876-1880   (includes  the  great  famine  of 

South  India)    14,076,000 

1881-1885  (5  years'  average)    14,748,000 

1886-1890  "  15,448,000 

1891-1895  "  16,522,000 

1895-96  "  17,467,000 

1896-97  (Famine  Year)   15,983,000 

1897-98 17,123,000 

1898-99  18,307,000 

1899-1900  (Famine  Year)   17,205,000 

1900-1901  17,503,000 

1900-1905  (Five  years'  average)   18,493,000 

1906-1 1  " 20,096,000 

191 1-12    ( Single  year)    20,765,000 

1912-13  21,282,000 

1913-14  21,392,000 

**  The  total  increase  in  the  gross  land  revenue  during 
the  past  fifty  years,"  says  the  writer  of  the  Govern- 
ment memorandum  (1909)  "has  been  sixty  per  cent. 


242  ENGLAND'S  DEBT  TO  INDIA 

measured  in  rupees ;  though  as  the  gold  value  of  the 
rupee  has  fallen  from  24d.  to  i6d.  the  increase,  if  meas- 
ured in  gold,  has  been  less  than  6  per  cent." 


PART  FOUR 


Even  as  we  look  on,  India  is  becoming  feebler  and 
feebler.  The  very  life-blood  of  the  great  multitude 
under  our  rule  is  slowly,  yet  ever  faster,  ebbing  away. 

—  H.  M.  Hyndman, 
In  "Bankruptcy  of  India,"  page  152. 


CHAPTER  IX 

ECONOMIC   CONDITION   OF  THE  PEOPLE 

"  There  is  one  fact  of  all  supreme  importance  —  the 
extreme  poverty  of  the  Indian  cultivator,  and,  indeed, 
of  the  whole  Indian  population.  Poverty  in  England 
or  America  or  Germany  is  a  question  of  the  distribu- 
tion of  wealth.  In  India  it  is  a  question  of  produc- 
tion." A.  Loveday,  in  "  The  History  and  Economies 
of  Indian  Famines,"  p.  5.     London  (1914). 

The  Poverty  of  the  Masses.  The  real  answer  to  the 
question  propounded  in  the  concluding  lines  of  the  last 
chapter,  is  to  be  found  in  the  economic  conditions  of 
the  country  and  the  general  poverty  of  the  masses. 
Here  again,  the  official  and  non-official  versions  differ 
widely.  Below  is  an  official  expression,  culled  from 
a  memorandum  presented  to  Parliament  in  1909  under 
the  title 

SOME   RESULTS   OF   THE   INDIAN    ADMINISTRATION 
DURING  THE  PAST  FIFTY  YEARS 

"  In  any  comparison  between  the  condition  of  the 
people  of  India  and  those  of  Europe,  it  must  be  re- 
membered that  in  India,  every  one  marries  and  mar- 
ries early;  that  the  population  tends  to  increase  at  a 
rate  varying  from  3^  per  cent,  per  annum  on  the  up- 
per Ganges  plain,  to  4  per  cent,  per  annum  in  Burma ; 
that  there  is  no  poor  law  or  system  of  poor  relief,  but 

24s 


246  ENGLAND'S  DEBT  TO  INDIA 

everywhere  widespread  and  openhanded  charity,  so 
that  the  infirm,  the  old,  the  sick,  the  cripple,  the  priest 
besides  many  who  prefer  a  mendicant's  life,  are  in 
ordinary  years  supported  by  the  alms  of  their  neigh- 
bours. Further,  it  must  be  remembered  that  in  rural 
India,  from  the  nature  of  the  climate,  and  immemorial 
custom,  the  poorer  classes  have  fewer  garments,  and 
can  replenish  them  more  cheaply,  than  is  the  case  in 
Europe.  Clothes,  warmth,  shelter,  furniture,  cost  very 
little  for  the  rural  Indian  family ;  the  bulk  of  the 
population  are  satisfied  with  two  meals  a  day,  of 
millet  cakes  or  porridge,  some  pulse  or  green  vegetable, 
salt  and  oil.  In  coast  districts  of  southern  India,  and 
in  Moslem  families,  a  little  salt  fish  or  meat  is  added 
to  the  daily  (?)  meal." 
"  General : 

"  So  far  as  ordinary  tests  can  be  applied,  the  aver- 
age Indian  landholder,  trader,  ryot  and  handicrafts- 
man, is  better  off  than  he  was  fifty  years  ago.  He 
consumes  more  salt,  more  tobacco  and  more  imported 
luxuries  and  conveniences  than  he  did  a  generation 
back.  Where  house  to  house  inquiries  have  been 
made,  it  has  been  found  that  the  average  villager  eats 
more  food  and  has  a  better  house  than  his  father; 
that  brass  or  copper  vessels  have  taken  the  place  of  the 
coarse  earthemvare  of  earlier  times;  and  that  his  fam- 
ily possess  more  clothes  than  formerly.  There  are  ex- 
ceptional districts,  like  North  Behar,  where  the  rural 
population  is  extraordinarily  dense,  or  parts  of  the 
Deccan  where  the  soil  is  extremely  poor,  and  the  rain- 
fall precarious ;  in  such  tracts,  the  condition  of  the 
landless  labourer  is  still  deplorably  bad.  There  are 
other  exceptional  tracts,  such  as  lower  Burma,  Assam, 
Malabar,  Canara,  the  Himalayan  districts,  and  a  great 
part  of  Eastern  Bengal,  where  the  population  is  sparse, 
or  not  too  dense,  the  soil  is  rich,  the  rainfall  always 
abundant,  and  good  markets  are  at  hand ;  in  such 
tracts,  wages  are  high,  work  and  food  are  abundant, 
there   is   a  comparatively  high   grade  of   living,   and 


ECONOMIC  CONDITION  OF  PEOPLE      247 

there  is  little  or  no  real  poverty.  The  greater  part 
of  India  lies  between  these  exceptional  extremes,  and 
on  the  whole,  the  standard  of  comfort  in  an  average 
Indian  village  household  is  better  than  it  was  fifty 
years  ago.  It  is  quite  certain  that  the  population  of 
India  absorbs  and  hoards  more  of  the  precious  metals 
than  it  did  formerly,  for  during  the  past  fifty  years, 
India's  net  absorption  from  outside,  of  gold  and  silver, 
has  amounted  to  the  equivalent  of  6303  millions  of 
rupees,  or  an  increase  of  126  millions  a  year,  while 
during  the  22  years  ending  with  1857,  India's  net  ab- 
sorption of  the  precious  metals  averaged  only  thirty- 
two  millions  a  year. 

"Conditions  of  different  classes;  I.  The  Landhold- 
ing  Class.  2.  The  Trading  Class.  3.  The  Profes- 
sional Class.  4.  The  Tenant  or  Ryot  Class.  5.  The 
Labouring  Class."  (We  omit  the  paragraphs  relating 
to  the  first  three  classes.) 

"  The  tenant  or  ryot  class  in  all  provinces,  enjoy 
some  share,  in  some  districts  a  considerable  share,  in 
the  increased  profits  of  agriculture.  In  Eastern  and 
Central  Bengal,  the  ryots  are  well  oflf.  In  the  Cen- 
tral Provinces,  where  tenant's  right  is  exceptionally 
strong,  the  ryots  are  mostly  in  good  circumstance. 
But  in  Behar,  in  most  of  the  Agra  Province  and  in 
Oude,  the  tenant  ryot  is  weak,  or  has  been  but  re- 
cently placed  on  a  firm  footing;  the  population  is 
dense,  holdings  are  small,  and  many  of  the  ryots  are 
in  poor  circumstances.  They  and  their  families  earn 
something  in  good  years  by  labour  outside  their  hold- 
ings, and  when  the  season  is  favourable,  they  live 
fairly  well.  A  ryot  with  a  tenant  right  under  the 
land,  can  generally  get  credit  in  a  year  of  short  harvest 
but  in  a  famine  year,  many  of  the  ryots  in  the  last- 
named  tracts  must  and  do  break  down. 

"  The  labouring  classes,  who  have  no  beneficial  in- 
terest in  the  land,  are  in  India  a  smaller  section  of  the 
people  than  in  England.     Still,  out  of  the  total  In- 


248  ENGLAND'S  DEBT  TO  INDIA 

dian  population  of  294  millions,  there  are  a  vast 
number  of  labourers,  and  their  condition  is  most  im- 
portant to  the  condition  of  the  country  .  .  .  the  wages 
.  ,  .  have  greatly  increased.  .  .  .  The  landless  la- 
bourer in  the  thickly  populated  rural  tracts,  remote 
from  railways  or  new  industries,  lives  poorly  now,  as 
in  generations  past,  and  their  wages  or  earnings,  are 
in  some  districts,  still  very  small." 

The  statements  contained  in  the  memorandum  are 
very  greatly  exaggerated,  one-sided  and  incomplete. 
The  writer  of  the  report  speaks  of  the  rise  in  wages, 
but  he  does  not  mention  the  rise  in  prices  and  gives  no 
data  on  which  to  base  the  generalities  indulged  in  by 
him.  A  rise  in  wages  is  valueless  if  the  rise  in  prices 
be  proportionately  higher.  Add  to  it  the  fact  that  the 
value  of  the  Indian  rupee  has  steadily  gone  down. 
It  was  2S.  in  the  fifties,  about  is.  lod.  in  the  seventies, 
IS.  4d.  in  the  nineties,  where  it  stands  now.  The  state- 
ment that  "  the  average  villager  eats  more  food  "  is 
absurdly  false.  The  argument  based  on  population 
will  be  noticed  in  the  chapter  on  famines,  and  that  on 
the  absorption  of  precious  metals  at  the  end  of  this 
book.  The  picture  drawn  in  this  memorandum  is 
wholly  incompatible  with  the  fact  that  the  average 
income  of  an  Indian  is  £2,  or  $10.00  a  year.  In  the 
meantime,  we  will  let  eminent  Englishmen  speak  on 
the  poverty  of  the  masses,  and  the  reader  may  be 
left  to  draw  his  own  conclusions.  With  reference  to 
the  statement  of  the  strength  of  the  labouring  class 
the  census  report  of  1911  fixes  the  number  of  farm 
servants  and  field  labourers  alone  at  forty-one  millions. 

Testimony  of  English  Public  Men.  Sir  William 
Hunter,  one  of  the  most  candid  writers  and  a  distin- 


ECONOMIC  CONDITION  OF  PEOPLE      249 

guished  historian  of  India,  director-general  of  Indian 
statistics  for  many  years,  declared  that  40,000,000  of 
the  people  of  India  were  seldom  or  never  able  to  satisfy 
their  hunger. 

Says  Mr.  J.  S.  Cotton  in  his  book,  "  Colonies  and 
Dependencies,"  p.  68  (1883):  "If  the  security  of 
British  rule  has  allowed  the  people  to  increase  it  does 
not  follow  that  it  has  promoted  the  general  prosperity. 
That  could  only  be  done  in  one  of  two  ways  —  either 
by  producing  a  distinct  rise  in  the  standard  of  living 
among  the  lowest  classes  or  by  diverting  a  considerable 
section  of  the  people  from  the  sole  occupation  of  agri- 
culture. .  .  .  Neither  of  these  things  has  been  done. 
Competent  authorities  indeed  are  of  opinion  that  the 
condition  of  the  lowest  classes  has  become  worse  under 
the  British  rule." 

Mr.  A.  O.  Hume,  Secretary  to  the  Government  of 
India  in  the  Agricultural  Department,  wrote  in  1880: 
"  Except  in  very  good  seasons,  multitudes  for  months 
every  year  cannot  get  sufficient  food  for  themselves 
and  family." 

Sir  Auckland  Colvin,  once  a  Finance  Minister  in  In- 
dia, describes  the  tax-paying  community  as  made  up  in 
the  main  of  "  men  whose  income  at  best  is  barely  suf- 
ficient to  afford  them  the  sustenance  necessary  to  sup- 
port life,  living  as  they  do  upon  bare  necessities." 

Sir  Charles  Elliott,  once  Chief  Commissioner  of 
Assam,  wrote  in  1888:  "  I  do  not  hesitate  to  say  that 
half  the  agricultural  population  do  not  know  from  one 
year's  end  to  another,  what  it  is  to  have  a  full  meal." 

The  Indian  Witness,  a  Christian  paper,  once  re- 
marked:    "It  is  safe  to  assume  that  100,000,000  of 


250  ENGLAND'S  DEBT  TO  INDIA 

the  population  of  India  have  an  annual  income  of  not 
more  than  $5.00  a  head." 

An  American  missionary  wrote  from  Southern  In- 
dia in  1902:  "  The  most  trying  experience  I  ever  had 
was  a  three  weeks'  tour  in  September  of  last  year 
(1901).  My  tent  was  surrounded  day  and  night,  and 
one  sentence  dinned  perpetually  into  my  ears :  *  We 
are  dying  for  lack  of  food.'  People  are  living  on  one 
meal  every  two  or  three  days.  I  once  carefully  ex- 
amined the  earnings  of  a  congregation  of  three  hun- 
dred, and  found  the  average  amounted  to  less  than  one 
farthing  a  head  per  day.  They  did  not  live,  they  eked 
out  an  existence.  I  have  been  in  huts  where  the  peo- 
ple were  living  on  carrion.  Yet  in  all  these  cases, 
there  was  no  recognised  famine!  In  Heaven's  name, 
if  this  is  not  famine,  what  is  it?  The  extreme  poverty 
of  the  poorer  classes  of  India  offers  conditions  alto- 
gether extraordinary.  Life  is  the  narrowest  and 
hardest  conceivable,  with  no  prospect  of  any  improve- 
ment. For  a  family  of  six  persons,  many  an  outfit, 
including  house,  utensils,  furniture,  clothing  and  all, 
is  worth  less  than  $10.00.  The  average  income  for 
such  a  family  will  not  exceed  fifty  cents  per  head  a 
month,  and  is  frequently  little  over  half  that.  It  may 
therefore  be  surmised  that  not  much  of  this  income  is 
spent  upon  cultivation  of  the  mind,  sanitation,  or  the 
appearance  of  the  dwelling."  ^ 

Average  Income  of  the  People.  According  to  offi- 
cial estimates,  the  maximum  average  annual  income  per 
head  of  the  people  of  India  is  thirty  rupees.     Lord 

1  Quoted  from  William  Digby's  "  Condition  of  the  People 
of  India,"  1902,  pp.  14-15- 


ECONOMIC  CONDITION  OF  PEOPLE      251 

Cromer,  then  Finance  Minister  for  India,  made  the 
first  estimate  in  1882,  placing  the  average  at  twenty- 
seven  rupees ;  Lord  Curzon,  the  late  Viceroy,  estimated 
the  income  of  the  agricultural  population,  85  per  cent, 
of  the  whole,  to  be  Rs.  30  per  year.  In  his  budget 
speech  for  1901,  Lord  George  Hamilton,  then  Secre- 
tary of  State  for  India,  said  the  average  income  was 
Rs.  30  (£2)  ;  Mr.  William  Digby,  C.  I.  E.,  after  a  full 
and  exhaustive  study  of  the  condition  of  the  people, 
financially  and  industrially,  furnishes  overwhelming 
evidence,  as  yet  unanswered  to  the  contrary,  to  show 
that  the  average  annual  income  of  the  people  of  India 
is  not  over  Rs.  173^  (about  six  dollars).  Considering 
the  value  of  the  rupee,  which  is  equivalent  to  about 
thirty-three  cents  American  money,  we  have  the  star- 
tling condition  of  millions  of  people  subsisting  on  from 
$6.00  to  $10.00  per  year,  or  about  two  cents  a  day, — 
this  by  official  estimate. 

The  Rev.  Dr.  Sunderland  cites  these  facts  and  fig- 
ures, in  support  of  his  observations  on  Indian  famines : 

"  The  truth  is,  the  poverty  of  India  is  something  we 
can  have  little  conception  of,  unless  we  have  actually 
seen  it,  as  alas,  I  have.  ...  Is  it  any  wonder  that  the 
Indian  peasant  can  lay  up  nothing  for  time  of  need? 
.  .  .  The  extreme  destitution  of  the  people  is  prin- 
cipally responsible  for  the  devastations  of  Plague ; 
the  loss  of  life  from  this  terrible  scourge  is  startling. 
It  reached  272,000  in  1901 ;  500,000  in  1902 ;  800,000 
in  1903;  and  over  1,000,000  in  1904.  It  still  continues 
unchecked.  The  vitality  of  the  people  has  been  re- 
duced by  long  semi-starvation.  So  long  as  the  pres- 
ent destitution  of  India  continues,  there  is  small 
ground  for  hope  that  the  Plague  can  be  overcome.  .  .  . 
The  real  cause  of   famines   in  India  is  not  lack  of 


252  ENGLAND'S  DEBT  TO  INDIA 

rain;  it  is  not  over-population;  it  is  the  extreme,  the 
abject,  the  awful  poverty  of  the  people." 

The  following  observation  was  made  in  "  Moral  and 
Material  Progress  of  India  for  1874-75"  (Parlia- 
mentary Blue  Book)  : 

"  The  Calcutta  missionary  conference  dwelt  on  the 
miserable,  abject  condition  of  the  Bengal  ryots,  and 
there  is  evidence  that  they  suffer  many  things,  and 
are  often  in  want  of  absolute  necessities.  ...  In  the 
Northwestern  Provinces,  the  wages  of  agricultural 
labourers  have  hardly  varied  at  all  since  the  beginning 
of  this  century ;  and  after  the  payment  of  the  rent,  the 
margin  left  for  the  cultivator's  subsistence  is  less  than 
the  value  of  the  labour  he  has  expended  .  .  .  many 
live  on  a  coarse  grain,  which  is  most  unwholesome, 
and  produces  loin  palsy.  .  .  .  This  extreme  poverty 
among  the  agricultural  population  is  one  of  the  reasons 
which  makes  any  improvement  in  farming  and  cultiva- 
tion so  difficult." 

Says  Mr.  H.  M.  Hyndman  in  "  Bankruptcy  of  In- 
dia," page  74  (1886  A.D.). 

"  That  the  people  of  India  are  growing  poorer  and 
poorer,  that  taxation  is  not  only  actually,  but  rela- 
tively far  heavier ;  that  each  successive  scarcity  widens 
the  area  of  impoverishment ;  that  famines  are  more 
frequent ;  that  most  of  the  trade  is  but  an  index  to  the 
poverty  and  crushing  over-taxation  of  the  people ;  that 
a  highly-organised  foreign  rule  constitutes  by  itself  a 
most  terrible  drain  upon  the  country." 

Said  Sir  William  Hunter,  former  member  of  the 
Viceroy's  Council,  in  a  speech  in  1875: 

"  The  Government  assessment  does  not  leave  enough 


ECONOMIC  CONDITION  OF  PEOPLE      253 

food  to  the  cultivator  to  support  himself  and  family 
throughout  the  year." 

The  Pioneer,  the  semi-official  paper  of  the  British- 
Indian  Government,  wrote  in  an  article  in  1877 : 

"  Worried  by  the  revenue  survey,  for  heavily  en- 
hanced public  payments  .  .  .  the  Deccan  ryot  ac- 
cepted, for  a  third  of  a  century  the  yoke  of  British  mis- 
management .  .  .  Report  upon  report  has  been  writ- 
ten upon  him;  shelf  upon  shelf  in  the  public  offices 
groaned  under  the  story  of  his  wrongs.  If  any  one 
doubts  the  naked  accuracy  of  these  words,  let  him  dip 
into  the  pages  of  Appendix  A.  (Papers  on  the  In- 
debtedness of  the  Agricultural  Classes  in  Bombay.) 
A  more  damning  indictment  was  never  recorded 
against  a  civilised  government." 

Mr.  Wilfrid  Scawen  Blunt,  in  his  "  India  Under 
Ripon,"  pages  236-238,  observes : 

"  No  one  accustomed  to  Eastern  travel  can  fail  to 
see  how  poor  the  Indian  peasant  is.  Travelling  by 
either  of  the  great  lines  of  railways  which  bisect  the 
Continent,  one  need  hardly  leave  one's  carriage  to  be 
aware  of  this.  ...  In  every  village  which  I  visited  I 
heard  of  complaints  ...  of  over-taxation  of  the 
country,  of  increase  and  inequalities  of  assessment 
.  .  .  complaints  of  the  forest  laws,  of  the  decrease  of 
the  stock  of  working  cattle,  of  their  deterioration 
through  the  price  of  salt,  of  universal  debt  to  the 
users.  .  .  . 

Says  the  same  writer,  earlier  in  his  work,  page  232 : 

"  India's  famines  have  been  severer  and  frequent ;  its 
agricultural  poverty  has  deepened,  its  rural  population 
has  become  more  hopelessly  in  debt,  their  despair 
more  desperate.     The  system  of   constantly  enhanc- 


254  ENGLAND'S  DEBT  TO  INDIA 

ing  the  land-values  has  not  been  altered.  The  salt 
tax  though  slightly  lowered,  still  robs  the  very  poor. 
Hunger,  and  those  pestilences  which  are  the  result  of 
hunger,  are  spread  over  an  increasing,  not  diminishing 
area.  The  Deccan  ryot  is  still  the  poorest  peasant  in 
the  world.  Nothing  of  the  system  of  finance  is 
changed,  nothing  in  the  economy  which  favours  Eng- 
lish trade  and  English  speculation  at  the  expense  of 
India's  native  industries.  What  was  bad  tzventy-Uve 
years  ago,  is  zvorse  now.  At  any  rate,  there  is  the 
same  drain  of  India's  food  to  alien  mouths.  Endemic 
famines  and  endemic  plagues  are  facts  no  official  sta- 
tistics can  explain  away."     (The  italics  are  mine.) 

In  1888  a  confidential  enquiry  into  the  economic  con- 
dition of  the  people  of  India  was  made  by  Lord  Duf- 
ferin.  The  results  of  the  enquiry  have  never  been 
made  public,  but  extracts  from  the  reports  of 
the  United  Provinces  of  Agra  and  Oude,  and  the 
Punjab,  have  been  published  by  Mr.  Digby  in  his 
monumental  work.  These  reports  are  well  worth  the 
attention  of  the  student  of  economic  conditions  in 
India.  We  can  only  refer  to  them  briefly.  One  of  the 
most  interesting  documents  is  the  report  of  Mr.  A. 
H.  Harrington,  Commissioner,  of  April  4,  1888.  Mr. 
Harrington  quotes  Mr.  Bennett,  the  compiler  of  the 
Oude  Gazeteer,  an  officer  whom  he  calls  "  wholly  free 
from  pessimism,"  as  to  the  condition  of  the  lowest 
castes  of  Oude : 

"  The  lowest  depths  of  misery  and  degradation  are 
reached  by  the  Koris  and  Chamars,"  whom  he  de- 
scribes as  *'  always  on  the  verge  of  starvation."  These 
represent  from  10  to  11  per  cent,  of  the  population 
of  Oude.     Mr.  Harrington  then  quotes  from  papers  he 


ECONOMIC  CONDITION  OF  PEOPLE       255 

himself  contributed  to  The  Pioneer  in  1876,  under  the 
heading,  "  Oude  Affairs  " : 

"  It  has  been  calculated  that  about  60  per  cent,  of 
the  entire  native  population  .  .  .  are  sunk  in  such  ab- 
ject poverty  that  unless  the  small  earnings  of  child 
labour  are  added  to  the  scanty  stock  by  which  the 
family  is  kept  alive,  some  members  would  starve." 

Whether  the  impression  that  the  greater  number  of 
the  people  of  India  suffer  from  a  daily  insufficiency  of 
food  is  true  or  untrue,  he  adds : 

"  My  own  belief,  after  a  great  deal  of  study  of  the 
closely  connected  questions  of  agricultural  indebted- 
ness, is  that  the  impression  is  perfectly  true  as  regards 
a  varying  but  ahvays  considerable  number  through- 
out the  greater  part  of  India." 

Mr.  A.  J.  Lawrence,  then  Commissioner,  Allahabad 
Division,  who  retired  in  1891,  reports: 

"  I  believe  there  is  very  little  between  poorer  classes 
of  the  people  and  semi-starvation,  but  where  is  the 
remedy  ?  " 

Of  Shahjehanpur,  another  district  of  the  United 
Provinces,  it  is  stated :  "  The  landless  labourer's  con- 
dition is  by  no  means  all  that  could  be  desired.  The 
combined  earnings  of  a  man,  his  wife  and  two  chil- 
dren cannot  be  put  at  more  than  Rs.  3  a  month. 
[Less  than  a  dollar  of  American  money.]  When 
prices  of  food  grains  are  lotv  or  moderate,  zvork  regular 
and  the  health  of  the  household  good,  this  income  will 
enable  the  family  to  hare  one  fairly  good  meal  a  day, 
to  keep  a  thatched  roof  over  their  heads,  to  buy  cheap 
clothing  and  occasionally  a  thin  blanket.  Cold  and 
rain  undoubtedly  entail  considerable  suffering,  as  the 
people   are   insufficiently   clothed,   and   cannot   afford 


256  ENGLAND'S  DEBT  TO  INDIA 

fires.  A  few  twigs  or  dried  sticks  constitute  the 
height  of  their  ambition,  and  these,  owing  to  the  in- 
creased vakie  and  scarcity  of  wood,  are  more  and  more 
difficult  for  the  poor  man  to  obtain."  (The  italics  are 
in  the  original.) 

Mr.  White,  Collector  of  Banda,  states: 

"  A  large  number  of  the  lower  classes  clearly  demon- 
strate by  their  physique,  either  that  they  are  habitually 
starved,  or  have  been  exposed  in  early  years  to  the 
severity  of  famines;  if  any  young  creature  be  starved 
while  growing,  no  amount  of  subsequent  fattening 
will  make  up  for  the  injury  sustained." 

Mr.  Rose,  Collector  of  Ghazipur,  says: 

"  Where  the  holding  is  of  average  size,  and  the 
tenant  unencumbered  with  debt,  when  his  rent  is  not 
excessive  and  there  is  an  average  out  turn  of  pro- 
duce ;  when  in  fact,  conditions  are  favourable,  the 
position  of  the  agriculturist  is,  on  the  whole,  fairly 
comfortable.  But  unfortunately,  these  conditions  do 
not  always  exist.  As  a  rule,  a  very  large  proportion 
are  in  debt." 

Of  the  Jhansi  Division,  Mr.  Ward,  Commissioner, 
says: 

"  A  very  small  proportion  in  this  division  are  habitu- 
ally underfed." 

Mr.  Bays,  officiating  Commissioner  for  Sitapur  Divi- 
sion, records  particulars  obtained  from  twenty  families 
taken  at  random: 

"  Nineteen  shillings,  twopence  or  less  than  five  dol- 
lars per  annum  for  each  adult. 


ECONOMIC  CONDITION  OF  PEOPLE       257 

"  Nine  shillings,  sixpence,  or  less  than  two  and  a 
half  dollars  per  annum  for  each  child." 

He  is  of  the  opinion  that  this  is  sufficient  to  keep 
them  in  good  health,  and  adds :  "  For  some  reasons,  it 
is  not  desirable  at  present  that  the  standard  of  com- 
fort should  be  very  materially  raised." 

Mr.  Irwin,  Deputy  Commissioner  of  Rae  Barali, 
says: 

"  The  mass  of  the  agricultural  population,  in  ordi- 
nary times,  and  the  elite  always,  get  enough  to  eat; 
but  there  is  a  considerable  minority  in  bad  seasons  who 
feel  the  pinch  of  hunger,  and  a  small  minority  .  .  . 
suffer  from  chronic  hunger,  except  just  at  harvest 
time  when  grain  is  plentiful,  and  easily  to  be  had.  I 
do  not  understand  that  the  indigent  town  population 
are  intended  to  be  included  in  this  enquiry.  There 
can  be  no  doubt  that  they  suffer  much  more  than  the 
agricultural  classes  for  want  of  food,  especially  the 
imfortunate  purdah-nashin  women,  and  indeed,  men 
too,  of  good  and  impoverished  families,  who  have  sunk 
in  the  world,  who  are  ashamed  to  beg,  and  live  on  the 
remnants  of  their  property  and  whom  every  rise  in 
prices  hits  cruelly  hard.  For  such  people  dear  grain 
means  starvation,  while  to  the  producer,  it  of  course 
means  increased  value  of  the  produce." 

Mr.  G.  Toynbee,  C.  S.  L,,  former  Member  of  the 
Viceroy's  Council  and  Senior  Member  of  the  Board 
of  Revenue,  said: 

"  The  conclusion  to  be  drawn  is  that  of  the  agri- 
cultural population,  40  per  cent,  are  insufficiently  fed, 
to  say  nothing  of  clothing  and  housing.  They  have 
enough  food  to  support  life  and  enable  them  to  work, 
but  they  have  to  undergo  long  fasts,  having  for  a 


258  ENGLAND'S  DEBT  TO  INDIA 

considerable  part  of  the  year  to   satisfy  themselves 
with  one  full  meal  a  day." 

Grierson's  statistics,  summed  up  in  The  Pioneer,  in 
1893,  state: 

"  Briefly,  it  is  that  all  persons  of  the  labouring 
classes,  and  ten  per  cent,  of  the  cultivating  and  ar- 
tisan classes,  or  45  per  cent,  of  the  total  population 
are  insufficiently  fed,  or  housed,  or  both.  It  follows 
that  nearly  one  hundred  millions  of  people  in  British 
India  are  living  in  extreme  poverty." 

The  Punjab  is  supposed  to  be  one  of  the  most  pros- 
perous provinces  of  India.  Mr.  Thorburn,  Member 
of  the  Punjab  Commission,  one-time  Financial  Com- 
missioner, says  of  the  agriculturists  of  that  province 
in  his  book  entitled,  "  The  Punjab  in  Peace  and  War  " : 

"  It  is  worthy  of  note  that  the  whole  revenue  of  the 
Punjab,  from  the  largest  item,  land  revenue,  to  the 
smallest  stamps,.  £10,000,  are  practically  drawn  from 
the  producing  masses,  whilst  the  literate  and  com- 
mercial classes,  whom  the  new  regime  was  to  benefit 
at  the  expense  of  those  masses,  escape  almost  un- 
taxed.    (Page  175.) 

"  Since  the  mutiny,  there  have  been  in  all,  seven 
years  of  famine,  viz.:  1860-1,  1876-8,  1896-7,  1899- 
1901 ;  in  addition,  scarcities  from  short  droughts  in 
semi-dependent  tracts,  have  been  frequent.  During 
the  earlier  famines,  four  years  in  all,  out  of  the  an- 
nual land  revenue  demand,  apart  from  water  rates  or 
canal  irrigated  lands,  hardly  2  per  cent,  were  sus- 
pended, and  the  fraction  ultimately  remitted,  or  writ- 
ten off  as  irrecoverable,  was  infinitesimal.  Since 
i8q6,  the  destitution  of  a  large  part  of  the  cultivators 
having  been  officially  proved,  the  Government  has  been 
less  niggardly  in  granting  suspensions  and  remissions. 


ECONOMIC  CONDITION  OF  PEOPLE      259 

[Italics  are  mine.]  Unfortunately,  the  relief  given 
coming  too  late,  fails  to  reach  the  classes  who  most  re- 
quire it  —  the  poorest  of  the  peasant  proprietary  — 
and  only  saves  the  pockets  of  the  capitalist  mortgagees 
and  purchasers  of  holdings.     (Page  242,) 

"If  it  be  remembered  that  the  average  daily  income 
per  head  of  the  Indian  population  is  less  than  three 
halfpence,  and  that  fully  25  per  cent,  of  that  popula- 
tion never  attain  that  average,  the  hand  to  mouth  ex- 
istence of  the  Punjab  peasantry,  even  in  normal  years, 
will  be  realised.  If  so,  their  general  inability  to  pay, 
without  borrowing,  the  land  revenue,  or  to  even  avoid 
death  from  starvation  whenever  a  scarcity  from 
drought  occurs,  let  alone  a  famine  period,  requires 
no  demonstration,     (Page  243.) 

"  The  Government  pronouncement  now  was  that 
even  if  the  masses  of  the  old  peasantry  were  sinking,  it 
was  too  late  to  change  a  system  which,  judged  by  all 
the  criteria  applied  to  European  countries,  cultivated 
area,  production,  revenue  under  all  heads,  consump- 
tion of  spirits  and  drugs,  all  showing  steady  progress 
except  during  and  immediately  after  famines.  Were 
the  Punjab  a  single  estate,  and  all  the  cultivators  ten- 
ants at  will  with  only  one  landlord,  these  criteria  would 
doubtless  indicate  prosperity.  But  seeing  that  its 
lands  are,  or  were,  owned  until  some  thirty  years  ago 
by  a  round  million  of  peasant  proprietary  families, 
their  prosperity  cannot  be  measured  by  the  gross  vol- 
ume of  production  and  consumption,  but  depends  on 
the  due  diffusion  amongst  the  producing  masses  of  the 
profits  of  their  labours.  Statistically,  the  Punjab 
might  be  the  richest  country,  yet  its  people  the  poorest, 
in  India,  if  they  were  the  rack-rented  tenants  of  capi- 
talists. That  is  the  condition  towards  which  our  *  sys- 
tem '  until  1900  was  reducing  the  *  finest  peasantry  in 
India.'"     (Page  254.) 

Among  the  latest  opinions  on  this  subject,  we  have 


26o  ENGLAND'S  DEBT  TO  INDIA 

that  of  Mr.  C.  J.  O'Donnell,  retired  member  of  the 
Indian  Civil  Service,  as  expressed  in  his  book  entitled : 
"The  Failure  of  Lord  Curzon": 

"  India  is  rapidly  becoming  a  land  steeped  in  peren- 
nial poverty,  and  unless  some  strong  and  early  steps 
are  taken,  the  English  people  will  find  itself  face  to 
face  with  annual  famines,  due  chiefly  to  the  exactions 
of  the  State,  to  the  oppression  of  the  poor  by  the  '  Im- 
perialist Empire  Builder.'  " 

As  an  independent  observer,  Mr.  J.  Ramsay  Mac- 
donald,  M.P.,  the  Labour  leader  of  Great  Britain,  may 
be  quoted  here.  In  his  book,  "  The  Awakening  of 
India,"  published  in  1910,  he  remarks: 

"  Sir  William  Hunter  said  that  40,000,000  Indians 
go  through  life  with  insufficient  food;  Sir  Charles  El- 
liott estimated  that  one-half  of  the  agricultural  popu- 
lation never  satisfied  hunger  from  one  year's  end  to  the 
other;  from  thirty  to  fifty  million  families  live  in 
India  on  an  income  which  does  not  exceed  threepence 
per  day.  The  poverty  of  India  is  not  an  opinion, —  it 
is  a  fact," 

For  independent  estimates  of  the  existing  condi- 
tions of  life  in  the  Bombay  and  Madras  Presidencies 
see  the  Appendices  for  extracts  from  recent  articles. 
We  give  the  rates  of  wages  also  in  an  appendix. 
Some  more  opinions  are  given  in  other  parts  of  the 
book  (see  the  Preface  and  the  Conclusion). 


PART  FIVE 


"  The  test  of  a  people's  prosperity  is  not  the  exten- 
sion of  exports,  the  multipHcation  of  manufactures,  or 
other  industries,  the  construction  of  cities.  No.  A 
prosperous  country  is  one  in  which  the  great  mass  of 
the  inhabitants  are  able  to  procure  with  moderate  toil, 
what  is  necessary  for  living  human  lives,  lives  of  frugal 
and  assured  comfort.  Judged  by  this  criterion,  can 
India  be  called  prosperous? 

"  Comfort  of  course  is  a  relative  term.  In  a  trop- 
ical country  like  India,  the  standard  is  very  low.  Lit- 
tle clothing  is  required, —  simple  diet  suffices.  An  un- 
failing well  full  of  water,  a  plot  of  land  and  a  bit  of 
orchard  —  these  will  satisfy  his  heart's  desire,  if 
needed,  you  add  the  cattle  needful  to  him.  Such  is 
the  ryot's  ideal  —  very  few  realise  it.  Millions  of 
peasants  in  India  are  struggling  to  live  on  half  an  acre. 
Their  existence  is  a  constant  struggle  with  starvation, 
ending  too  often  in  defeat.  Their  difficulty  is  not  to 
live  human  lives, —  lives  up  to  the  level  of  their  poor 
standard  of  comfort, —  but  to  live  at  all,  and  not  die. 
We  may  well  say  that  in  India,  except  in  the  irrigated 
tracts,  famine  is  chronic  —  endemic." 
— "  India  and  Its  Problems,"  by  W.  S.  Lily,  pp.  284-85. 


CHAPTER  X 

FAMINES  AND  THEIR  CAUSES 

Famines  in  the  Past.  "  The  famines  of  India  are 
among  the  most  startling  phenomena  of  our  time. 
They  seem  to  be  steadily  increasing  both  in  frequency 
and  severity.  During  the  last  forty  years  of  the  nine- 
teenth century, —  from  1860-19CX3, —  India  was  smitten 
by  not  less  than  ten  famines  of  great  magnitude,  caus- 
ing a  loss  of  life  that  has  been  conservatively  esti- 
mated at  i5,ooo,CK)o.  These  figures  are  appalling. 
Such  a  condition  of  things  naturally  awakens  the  sym- 
pathy of  the  whole  world." 

Statements  like  this  made  by  the  Rev.  Dr.  Sunder- 
land of  New  York,  have  forced  British  Imperialists 
to  extenuate  their  position  in  the  eyes  of  the  nations, 
by  citing  the  frequency  of  famines  in  India  in  pre- 
British  days,  and  by  the  fact  that  under  the  old  eco- 
nomic order,  famines  were  not  unknown  in  England 
and  France.  Sir  Theodore  Morison,  Member  of  the 
Council  of  the  Secretary  of  State  for  India,  opens  his 
chapter  on  famines  in  his  book  called  "  The  Economic 
Transition  in  India,"  by  the  remark  that  "  dearth  or 
famine,  at  irregular  intervals,  was  inseparably  con- 
nected with  conditions  which  determined  the  old  eco- 
nomic order"  (page  92).  He  then  proceeds  with  an 
account  of  the  English  famine  of  1586,  and  the  French 
famines  of  1675  ^^^  1699, —  following  with  a  descrip- 

263 


264  ENGLAND'S  DEBT  TO  INDIA 

tion  of  the  Indian  famines  of  pre-British  days.  Four 
pages  have  been  devoted  to  extracts  from  the  diary 
of  "  the  blunt  English  sailor,  Peter  Lundy,"  about  the 
famine  of  1630;  four  more  to  extracts  from  British 
documents  about  famines  in  Madras  from  1709  to 
1752;  thereafter  proceeding  with  extreme  brevity  to 
describe  the  terrible  famines  of  1770,  1783,  1790-92, 
and  1837,  during  the  British  occupation.  Famines  dur- 
ing the  latter  part  of  the  century  are  described  in  a 
page  and  a  half  of  generalities,  although  the  greatest 
famines  of  the  century  occurred  during  its  latter  half. 
The  chapter  concludes  with  a  discussion  of  the  nature 
of  Indian  famines  and  what  has  been  done  by  the  Brit- 
ish Government  to  prevent  them. 

In  a  paper  entitled  "  Some  Plain  Facts  About  Fam- 
ines in  India,"  read  before,  and  published  by  the  East 
India  Association  of  London, —  Hindu  legends,  and  the 
great  epics,  the  Mahabbarata  and  the  Ramayana  were 
requisitioned  to  prove  that  "  severe  famines  occurred 
between  1107  and  1143  a.  d."  A  southern  tradition  was 
vaguely  quoted  to  establish  the  fact  of  a  "  twelve  years' 
famine,"  time  and  place  not  stated.  To  these  statistics 
is  appended  a  list  of  famines  during  the  Mogul  dy- 
nasty, 1596-1792,  itemised  as  follows: 

Sixteenth  century,  two  famines. 
Seventeenth  century,  two  famines. 
Eighteenth  century,  four  famines  (two  of  which  fell 
within  the  time  of  British  occupation). 

Mr.  Digby's  Table.  The  following  list  of  Indian 
famines  of  the  past,  made  by  Mr.  William  Digby,  is 
however,  more  accurate  and  includes  every  famine 
known  to  Indian  history. 


FAMINES  AND  THEIR  CAUSES        265 

nth  century. . Two  famines,  both  local 

13th  century One  famine  around  Delhi,  local 

14th  century Three  famines,  all  local 

15th  century Two  famines,  both  local 

i6th  century Three  famines,  all  local 

17th  century Three  famines,  area  not  defined 

i8th  century  (to  1745)  Four  famines,  all  local 
The  last  thirty  years  of  the  i8th  century. 

1769-1800 Four  famines,  Bengal,  M'adras, 

Bombay  and  southern  India. 

Famines  of  the  19th  century  and  loss  of  life  there- 
by ;  divided  into  four  periods  of  25  years : 
1800-1825,  five  famines. ..  .Approx.  1,000,000  deaths 
1826-1850  two  famines....       "  500,000      " 

1851-1875,  six  famines.  ...Recorded    5,000,000      " 
1876-1900,     EIGHTEEN     FAMINES,     Estimated 

26,000,000  deaths. 

"  The  foregoing  official  figures  show  over  one  mil- 
lion deaths  per  annum  during  the  last  ten  years,  or 
two  British-Indian  subjects  passed  away  from  starva- 
tion, or  starvation-induced  diseases,  every  minute  of 
every  day  and  night,  from  Jan.  i,  1889,  to  Sept.  30, 
1901 !  Nevertheless,  only  a  few  persons  in  the  United 
Kingdom  are  doing  aught  to  prevent  the  continuance 
of  such  an  awful  state  of  things,  and  the  Secretary  of 
State  for  India  '  stands  amazed  at  the  prosperity '  of 
the  region  he  is  governing."  ^ 

Digby's  "  Prosperous  British  India." 

The  author  of  "  Prosperous  British  India "  then 
adds  (pages  137-139)  : 

1  A  fuller  and  more  accurate  list  is  given  by  Mr.  A.  Loveday 
in  his  "  Indian  Famines,"  London,  G.  Bell  &  Sons,  1914,  Ap- 
pendix A.  His  remarks  as  to  the  relief  measures  taken  by 
Native  Administrators  before  the  British  are  specially  valuable. 
See  pp.  102  and  103. 


266  ENGLAND'S  DEBT  TO  INDIA 

"  Are  Indian  famines  more  destructive  to  human  life 
now  than  in  ancient  days  ?  Yes  —  they  were  more  de- 
structive within  the  famine  areas  until  '76-78 ;  since 
then,  the  Famine  Code,  when  acted  upon,  as  it  merci- 
fully was  in  1901,  checks  mortality.  The  extent  of 
the  relief  administered  may  be  judged  when,  in  the  dis- 
trict of  Raipur,  forty  inhabitants  out  of  every  hundred 
were  on  relief.  As  much  time  and  energy  given  to 
devising  means  of  prevention  as  have  been  devoted  to 
relief  measures,  would  ere  this  have  stopped  famines. 
There  are  districts  in  Bombay,  in  which,  despite  the 
Famine  Code,  people  died  like  flies.  Meanwhile,  the 
Census  Returns  have  been  published : 

1891  Total  population  of  India  287,223,431 

1901  Gov't  estimate  of  normal  increase  as  it  should 

be 330,306.945 

1901  Population  as  it  actually  was 294,000,000 

"  The  Indian  special  correspondent  of  the  Lancet, 
writing  to  that  journal  May  16,  1901,  put  the  loss  of 
life  at  19,000,000  people.     To  quote: 

"  *  During  the  last  decade,  it  is  estimated  that  the 
total  population  of  India  has  only  increased  by  2,800.- 
000  (?)  a  rate  considerably  less  than  that  of  the  pre- 
vious decade.  Two  causes  only  can  affect  the  num- 
bers of  people ;  a  diminished  birth-rate  —  at  the  out- 
side, 20  per  cent,  could  be  put  down  to  this  cause.  An 
enhanced  mortality  must  be  the  chief  factor.  It  is  es- 
timated there  were  20,000,000  more  deaths  than  there 
should  have  been,  and  if  we  put  1,000,000  deaths  down 
to  plague,  there  remain  19,000,000  that  can  be  attrib- 
uted either  to  actual  starvation  or  diseases  therefrom.' 

"  This  statement  by  what  is  probably  the  foremost 
medical  journal  in  the  world,  means  that  the  loss  of 
life  thus  recorded  represented  '  the  disappearance  '  of 
fully  one-half  a  population  as  large  as  that  of  the 
United  Kingdom." 


FAMINES  AND  THEIR  CAUSES       267 

Famines  in  the  Twentieth  Century. 

1901 — General  famine  year,  direct  expenditure  on  re- 
lief, £556,000. 
1902 — "  Considerable  distress  "  in  Central  Provinces ; 

relief  expenditure,  £315,500. 
1903 — Failure  of  crops  in  parts  of  upper  Burma. 
1904 — Bengal,  "  bad ;  "  Punjab,  "  unfavourable ;  "  Cen- 
tral Provinces,  "  deficient;  "  Madras,  "  rice-crop 
failed,      considerable      deficiency ; "      Bombay, 
"poor;"    Gujrat,    "famine    but    not    acute;" 
United  Provinces,  "  fat  ;  "  Bundelkhand,  "  fam- 
ine ;  "  Agra,  "  agriculture  disorganised." 
1905 — Bengal,    "partially    bad;"    United    Provinces, 
"scarcity  and  famine;"  Punjab,  distress,  relief 
works  in  Delhi ;  N.W.  Frontier,  "  poor ;  "  Cen- 
tral Prov.  &  Barar,  "  rice-crop  failed,"  "  relief 
works  ;  "    Madras,    "  unfavourable ;  "    Bombay, 
"  famine  conditions  in  Deccan,"  etc. 
1906 — Bengal,  "  partly  fair,  rest  poor ;  "  East  Bengal 
and  Assam,  distress  of  last  year  continued  to 
this  ;  United  Prov.,  ditto. 
1907 — A  year  of  general  famine. 
1908 — Famine  continued,   severe  distress   in  Orissa ; 
disaster  in  Behar. 
"  In    1907-8  a  widespread   failure  of   the   autumn 
harvest,  and  serious  reductions  in  the  area  and  out  turn 
of  the  spring  crop  forced  large  numbers  to  resort  to 
Government  Relief.     The   executive  was   faced  with 
the  necessity  of  providing  direct  measures  of  famine 
relief  in  an  area  of  66,000  square  miles  with  a  popula- 
tion  of   30,000,000.     Gratuitous   relief   continued   till 
the  end  of  August." 

Thus  the  general  famine  of  1907  persisted  in  large 
districts  until  1909.  Bengal,  Behar,  Central  Provinces 
with  Berar,  Assam  and  Bombay,  all  felt  the  effects  and 


268  ENGLAND'S  DEBT  TO  INDIA 

suffered  acutely,  most  of  them  having  relief  works  and 
gratuitous  relief  grants  until  1909. 

In  191 1  the  rainfall  failed  over  a  considerable  area 
in  Gujrat  in  the  Bombay  Presidency  and  also  in  1912 
in  the  Ahmednagar  District  of  the  Bombay  Deccan. 
Again  rains  failed  over  large  areas  in  the  United 
Provinces  in  1913-14.  This  famine  affected  17,000 
square  miles  vi^ith  a  population  of  five  and  a  quarter 
millions  while  distress  was  grave  in  30,000  square 
miles  with  a  population  of  fourteen  millions.  There 
was  acute  distress  in  parts  of  Bengal  in  1914-15,  yet 
the  export  of  grain  from  India  was  never  stopped. 

Famines  During  the  British  Period.  Critics  of  Brit- 
ish rule  in  India  argue : 

1.  That  famines  have  been  more  frequent  under  Brit- 
ish domination. 

2.  That  there  have  been  a  larger  number  of  "  general  " 
famines,  during  British  rule,  than  were  ever  known 
before  in  Indian  history. 

3.  That  though  Indian  famines  are  primarily  due  some- 
times to  failure  of  monsoons,  and  at  other  times  to 
floods  and  other  causes  beyond  the  control  of  man, 
yet  the  widespread  distress  and  huge  mortalities 
that  have  followed  the  failure  of  monsoons  during 
British  occupation  are  to  a  great  extent  due  to  the 
economic  effects  of  Great  Britain's  fiscal  policy  in 
India,  which  annihilated  indigenous  industries,  ex- 
acted exorbitant  land  revenues  and  impoverished 
the  people. 

4.  That  the  development  of  railway  systems  with  an 
eye  to  furthering  British  trade,  has  been  pushed  to 
the  detriment  of  canal  construction  and  other  meth- 
ods of  irrigation. 

5.  That  the  widespread  mortality  and  woful  destitu- 


FAMINES  AND  THEIR  CAUSES        269 

tion  of  the  people  during  famine  periods  are  pre- 
ventable. 

6.  That  famine  conditions  are  now  chronic  in  India. 

7.  That  the  Indian  famines  of  modern  times  are  not 
famines  of  foodstuffs,  but  of  money  —  there  being 
at  all  times  sufficient  food  in  the  country  to  feed 
the  entire  population,  had  the  people  the  where- 
withal to  buy  it  at  the  prices  demanded  by  export- 
merchants  and  dealers. 

The  facts  for  the  famines  of  the  decade  1900  to  1910 
are  taken  from  the  government  Blue  Books.  In  the 
majority  of  the  reports  the  mortality  is  neither  given 
nor  estimated.  The  facts,  however,  speak  for  them- 
selves ;  famine  or  scarcity  over  all,  or  a  large  part  of 
India,  every  year,  from  1901  to  1910.  To  a  people 
ravaged  by  starvation  and  disease,  the  decrease  in 
powers  of  resistance  necessarily  increases  mortality 
lists.  In  the  year  1899-1900,  one  of  the  greatest  fam- 
ine years  of  the  century,  more  than  a  million  persons 
died  in  British  India  alone.  Preceded  by  the  "  ex- 
ceeding great "  famine  of  1895-97,  it  proved,  in  Lord 
Curzon's  words,  to  be  the  "  most  terrible  famine  in 
Indian  history."  Crops,  and  incidental  losses  were  es- 
timated to  be  not  less  than  £150,000,000;^  the  total 
admitted  loss  of  life  in  forty-seven  years,  from  1854 
to  1901,  was  28,825,000  persons! 

Causes  of  Famines.  The  British  Imperialist 
ascribes  Indian  famines  to  the  following  causes : 

(i)  Shortage  of  rainfall  and  other  natural  causes. 
(2)   Overpopulation.     (3)   Lack  of  thrift  by  the  In- 

2  Sir  T.  W.  Holderness  estimated  it  at  £80,000,000,  quoted 
by  Loveday,  p.  124. 


270  ENGLAND'S  DEBT  TO  INDIA 

dian  ryot  in  years  of  prosperity,  particularly  on  the 
occasions  of  marriages  and  funerals. 

All  of  these  ostensible  causes  have  been  examined 
from  time  to  time,  by  honest  and  disinterested  Brit- 
ishers, actuated  by  humane  motives.  Most  prominent 
and  often  most  outspoken  among  them  have  been  those 
who  served  their  Government  in  India  in  various  ca- 
pacities. Their  observations  are  based,  not  on  casual 
trips  of  a  few  days  or  months,  but  on  periods  of  service 
extending  over  twenty-five  and  thirty  years,  or  longer. 
Various  Americans  have  examined  the  facts  about  In- 
dian famines,  and  pronounced  themselves  in  agreement 
with  these  British  humanitarians,  as  to  their  real  cause. 

Shortage  of  Rainfall.  On  page  140  of  his  book, 
"  Prosperous  British  India,"  Mr.  Digby  propounds  the 
question : 

"  Why  is  it  India  is  more  liable  to  devastation  by 
famine  than  are  other  countries?  Answer:  Not  be- 
cause rains  fail  and  moisture  is  denied ;  always  in 
the  worst  of  years  there  is  water  enough  poured  from 
the  skies  on  Indian  soil,  to  germinate  and  ripen  the 
grain, —  but  because  India  is  steadily  growing  poorer." 

For  detailed  information  on  this  point,  and  an  analysis 
of  rain  registers  for  nearly  ninety  years,  Mr.  Digby 
refers  the  reader  to  a  chapter  in  the  life  of  Sir  Arthur 
Cotton  (Hodder  &  Stoughton,  London)  entitled,  "  Is 
famine  in  India  due  to  an  insufficiency  of  Land? " 

Says  the  Rev.  Dr.  Sunderland,  of  New  York : 

"  It  is  generally  supposed  that  famines  in  India  are 
always  in  years  of  very  light  rainfall;  this  is  a  great 
mistake  —  they  are  often  years  of  very  heavy  rainfall. 
The  only  trouble  is,  the  rain  comes  too  early,  too  late, 


FAMINES  AND  THEIR  CAUSES       271 

or  too  much  at  a  time,  and  is  not  stored.  The 
water  is  allowed  to  go  to  waste  for  lack  of  storage, 
hence  there  is  disaster.  The  year  of  the  great  Madras 
famine  of  1877  was  one  with  the  enormous  rainfall 
of  sixty-six  inches.  In  the  year  of  the  Orissa  famine, 
1865-66,  the  rainfall  was  sixty  inches.  In  the  Bom- 
bay famine  of  1876  the  rainfall  of  the  year  was  fifty 
inches.  In  the  famine  of  1896-97  in  the  Central  Prov- 
inces, the  record  of  the  two  years  was  fifty-two  and 
forty-two  inches.  In  the  great  famine  year,  1900,  the 
average  rainfall  where  the  famine  was  most  severe 
was,  (I  omit  fractions)  Northwestern  Provinces,  thir- 
ty-two inches;  Punjab,  eighteen  inches;  Central  Prov- 
inces, fifty-two  inches  ;  Central  India,  thirty-six  inches ; 
Rajputana,  twenty  inches;  Berar,  thirty-one  inches; 
Bombay,  forty  inches.  Thus  we  see,  in  most  instances, 
the  real  lack  is  not  rain,  it  is  storage.  Says  Major 
Philip  B.  Phipson,  and  few  persons  can  speak  with 
more  authority :  '  The  water  supply  of  India  is  am- 
ple for  all  requirements ;  it  only  requires  to  be  diverted 
from  her  rivers,  stored  up  from  her  rainfall,  and  dis- 
tributed over  her  fields,  to  secure  such  an  abundance 
as  shall  leave  no  single  human  being  wanting  it.* "  ^ 

Are  the  Famines  of  India  Due  to  Over-Population^ 
This  question  also  may  best  be  answered  in  the  lan- 
guage of  Dr.  Sunderland: 

"  Very  little  study  of  the  facts  furnishes  an  answer 
to  this  question.  The  population  of  India  is  not  so 
dense  as  in  a  number  of  the  European  States,  which 
are  prosperous,  which  have  no  difficulty  in  supporting 
their  people,  and  in  which  famines  are  never  dreamed 
of.  Nor  is  the  birthrate  high  in  India.  It  is  less 
than  in  England,  and  much  less  than  in  Germany  and 
other  Continental  countries.     India  is  not  overpopu- 

3 "  Indian  Poverty  and  Indian  Famines,"  p.  52,  published 
from  the  Asiatic  Quarterly  Review,  by  Wra.  Hutchinson,  D.D., 
London,  1903. 


272 


ENGLAND'S  DEBT  TO  INDIA 


lated.*  Even  under  present  conditions,  she  pro- 
duces more  than  enough  food  for  all  her  people. 
Were  her  agricultural  possibilities  properly  developed, 
she  could  easily  support  a  greatly  increased  population. 
There  are  enormous  areas  of  waste  land  that  should 
be  brought  under  cultivation."^  The  Hon.  D.  M.  Hamil- 
ton, in  his  speech  in  the  Viceroy's  Council  on  the  In- 
dian Budget  for  1904,  declared  that  there  are  a  hun- 
dred million  acres  of  cultivable  land  still  available  in 
India.  In  these  very  large  reclaimable  areas,  and  in  the 
opportunities  for  the  extension  of  irrigation  already 
referred  to,  we  have  ample  provision  for  increase  in 
India's  population. 

"  But  beyond  these  is  another  resource  still  greater. 
Long  ago,  Sir  James  Caird  urged  upon  the  Indian  Gov- 
ernment the  necessity  for  better  agricultural  methods, 
calling  attention  to  the  fact  that  a  single  additional 
bushel  per  acre  raised  by  the  ryot  would  mean  food 
for  another  22,000,000  people.  But  the  addition  of  a 
bushel  per  acre  is  only  a  beginning  of  what  might  be 
done.  Here  is  a  resource  practically  inexhaustible, 
which,  added  to  the  others,  makes  the  suggestion  that 
population  outstrips  agricultural  possibilities,  and  that 
therefore,  famines  are  inevitable,  positively  ludicrous." 

The  following  figures  support  Mr.  Sunderland's  con- 
clusion : 


Average    Increase 

of  Population  per 

year  per  million 

Germany,  1837 

Germany,  191 1 

31.589,547 

64,925,993 

14,528 

Belgium.  1866 

Belgium,  1912 

4,827,833 

7,571,387 

11,919 

England,  1871 

England,  191 1 

21,495,131 

31,045,270 

11,726 

Japan,  1908 

Japan,  1914 

49,588,804 

53,696.888 

10,270 

*  Mr.  Loveday  remarks :  "  It  is  difficult  to  find  evidence 
to  prove  that  over-population  in  India  is  a  reality"   (p.  99). 

^Of  late  something  has  been  done  in  this  direction  with 
beneficial  results. 


FAMINES  AND  THEIR  CAUSES        273 

Average     Increase 
of  Population  per 
year  per  million 
Hungary,  1880  Hungary,  igio 

15,737.259  20,886,487  11,443 

India,  1861  India,  191 1 

215,798,302  302,494,794  8,636 

British  India,  1901        British  India,  191 1 

2,31,610,000  244,270,000  5,623 

Native  States,  1901      Native  States,  191 1 
62,755,116  70,888,854  13,085 

The  following  table  (Hazells  "Annual"  for  1917) 
supports  Dr.  Sunderland's  statement: 

Increase  of  Population 

1881-1891  1891-J901  1901-igii  Total 

England  and  Wales   11.7  12.2  10.9  34.8 

Australian   Commonwealth  41. i  18.9  18.1  78.1 

German  Empire   9.3  14.0  15.2  38.5 

Hungary    I  l.o  10.3  8.5  29.8 

Netherlands    12.4  13.1  14.8  40.3 

United   States   25.5  20.7  21.0  67.2 

India 13.2  2.5  7.1  22.8 

The  population  of  Russia  is  said  to  be  increasing  at 
the  rate  of  2,500,000  a  year.  The  total  population,  in 
1916,  was  182,182,600.  Comparing  the  pressure  of 
population  per  square  mile  we  find  that  while  the 
United  Kingdom  has  a  population  of  374  per  square 
mile ;  Austria  222 ;  Belgium  658 ;  Denmark  280 ;  France 
193;  German  Empire  311;  Hungary  270;  Italy  315; 
Japan  356;  Netherlands  607;  Switzerland  236;  India 
has  only  158.  Then  Japan  with  a  density  of  popula- 
tion twice  as  great  as  that  of  India  and  only  one-sixth 
of  her  area  arable  does  not  suffer  from  famines. 

Should  the  reader  enquire  at  this  point,  why  Indian 
agriculture  is  still  primitive,  the  reply  is, —  want  of 
capital.^ 

^  Mr.  A.  Loveday,  in  his  book  on  "  The  History  and  Eco- 


274  ENGLAND'S  DEBT  TO  INDIA 

Are  Famines  Due  to  Scarcity  of  Food?  Says  Dr. 
Sunderland :  "  But  even  under  present  conditions, 
with  irrigation  as  imperfectly  developed  as  now,  and 
so  large  a  part  of  the  rainfall  wasted,  India  is  one  of 
the  greatest  food-producing  lands.  No  matter  how 
severe  the  drought  may  be  in  some  parts,  there  is  never 
a  time  when  India  as  a  whole  does  not  produce  food 
enough  for  all  her  people.  Indeed,  in  her  worst  fam- 
ine years,  she  exports  food.  In  her  worst  famine 
years  there  is  plenty  of  food  to  be  obtained,  and  in  the 
famine  areas  themselves,  for  those  who  have  money 
to  buy  with.  This  the  Famine  Commissioners  them- 
selves have  told  us. 

Says  Mr.  J.  Ramsay  MacDonald,  M.P.,  in  "The 
Awakening  of  India,"  page  163 :  "  In  studying  fam- 
ines, one  must  begin  by  grasping  what  it  is  and  how  it 
presents  itself.  Even  in  the  worst  times  there  is  no 
scarcity  of  grain  in  the  famine  stricken  districts.  At 
the  very  worst  time  in  the  Gujerat  famine  of  1900,  it 
was  shown  by  the  official  returns  that  there  was  '  suflfi- 
cient  grain  to  last  for  a  couple  of  years  in  the  hands  of 
the  grain  dealers  of  the  district.  It  is,  therefore,  not  a 
scarcity  of  grain  that  causes  famines.'  In  recent  times, 
famine  has  been  caused  by  a  destruction  of  capital  and 
the  consequent  cessation  of  the  demand  for  labour, 

iiomics  of  Indian  Famines,"  (London,  1914)  discusses  the  ques- 
tion at  some  length.  He  acquits  the  Indian  agriculturist  of 
all  charges  of  "laziness  or  inefficiency"  and  adds  that  "all 
experts  praise  him."  In  his  opinion,  supported  by  that  of 
Dr.  Voelker  (expressed  in  his  report  on  "  Improvement  of 
Indian  Agriculture,  1893),  "it  is  not  the  lack  of  skill  on  the 
part  of  the  cultivator  but  the  smallness  of  his  holding,  the 
scarcity  of  capital  and  the  decay  of  domestic  industries  and 
his  incapacity  to  withstand  the  strain  of  famine "  that  is 
responsible  for  the  intense  distress  caused  by  famines. 


FAMINES  AND  THEIR  CAUSES       275 

High  prices  coincide  with  low  wages,  and  unemploy- 
ment, and  the  people  starve  in  the  midst  of  plenty." 

Is  the  Distress  Due  to  the  Extravagance  of  the  Ryot 
on  Occasions  of  Marriages  and  Funerals f  The  re- 
ports of  the  government  enquiry  in  1887-88  repudiate 
this  theory.     Says  Mr.  Digby: 

"  Taking  the  first  twenty  cases  exactly  as  they  ap- 
pear in  the  record  of  the  Government  enquiry  in  which 
reference  is  made  to  indebtedness,  they  do  not  sustain 
the  assertion  of  the  Lieutenant-Governor.  In  only  two 
of  these  cases  are  marriage  and  family  expenses  put 
down  as  the  occasion  of  indebtedness.  In  one  case,  the 
amount  was  the  trifle  of  Rs.  10,  half  already  repaid  in 
monthly  instalments  of  one  rupee.  That  is  to  say, 
10  per  cent,  of  borrowings  only,  are  specifically  for 
marriage  purposes.  In  the  Punjab,  Mr.  Thorburn's 
particulars  compare  not  unfavourably:  'Of  seven 
hundred  and  forty-two  families,  only  in  three  cases  was 
marriage  extravagance  the  cause  of  their  serious  in- 
debtedness.* The  common  idea  about  the  extrava- 
gance of  marriage  is  not  supported  by  evidence.  Un- 
necessary marriage  expenses  show  a  tendency  year  by 
year  to  decrease.  This  is  susceptible  of  statistical 
proof : 


Full 

Indebtedness 

'Marriage 
Expenses 

Percentage 

Circle      I. 
Circle    II. 
Circle  III. 
Circle  IV. 

Rs.  142,737 
"     179,853 
"      88,234 
"    188,145 

Rs.    9,491 
"    12,418 
"      9.687 
"    I5,i6i 

7 
II 
8 

Average :  less  than  8% 

Mr.  Loveday  has  also  incidentally  spoken  of  the  ex- 
travagance of  the  Indian  ryot.    Examining  into  the 


276  ENGLAND'S  DEBT  TO  INDIA 

causes  of  the  ryot's  indebtedness  he  says :  "  Tempta- 
tions to  unnecessary  extravagance  have  been  accom- 
panied in  some  instances  by  a  growing  pressure  from 
above  for  rent,  by  an  inelastic  demand  for  land  revenue 
and  to  a  less  degree  in  the  more  distant  parts,  by  an 
insecurity  from  enhanced  assessments  (page  131). 

The  True  Cause.  We  have  laboured  in  vain  if  the 
reader  is  not  in  a  position,  after  these  citations,  to  judge 
for  himself.  The  question:  what  causes  Indian  fam- 
ines? is  best  answered  in  the  language  of  the  Amer- 
ican gentleman  quoted  above.     Says  Dr.  Sunderland: 

"What  then  is  the  cause  of  the  famines  in  India? 
The  real  cause  is  the  extreme  poverty  of  the  people. 
It  is  a  poverty  so  severe,  that  it  keeps  a  majority  of  all 
on  the  verge  of  suffering  even  in  years  of  plenty, 
and  prevents  them  from  laying  up  anything  to  tide  them 
over  in  years  of  scarcity.  If  their  conditions  were 
such  that  in  good  seasons  they  could  get  a  little  ahead, 
in  the  bad  years  they  could  draw  upon  that  as  a  re- 
source. This  would  not  save  them  from  hardship,  but 
it  would  from  starvation.  But  as  things  are,  the  vast 
majority  have  no  such  resource." 

"If  the  poor  sufferers  are  so  fortunate  as  to  be 
received  by  the  government  at  the  famine  relief  works, 
where,  in  return  for  exacting  labour  in  breaking  stone, 
or  similar  work,  they  are  supplied  with  sufficient  means 
to  buy  food  to  sustain  life,  then  the  hardiest  of  them 
survive  until  the  rains  come,  when,  with  depleted 
strength  they  go  back  to  their  stripped  homes,  and 
barehanded,  begin  as  best  they  can  to  raise  a  new  crop 
and  support  such  members  of  their  family  as  may 
be  left.  Here  we  have  the  real  cause  of  the  famines 
in  India." 


FAMINES  AND  THEIR  CAUSES        277 

FAMINE  RELIEF 

As  to  famine  relief,  the  work  of  the  English  de- 
serves ungrudging  praiseJ  They  have  reduced  it  to 
a  science.  One  is  sorry  the  brain,  the  energy,  the 
talent,  the  zeal  employed  in  saving  life  and  ameliorating 
distress,  should  not  have  been  spent  in  preventing  fam- 
ines, instead  of  in  systematising  relief.  The  demoralis- 
ing effect  of  such  relief  cannot  be  sufficiently  appre- 
ciated by  the  foreigner.  India  has  perhaps  the  largest 
number  of  professional  beggars  in  the  world,  yet  the 
average  Indian,  be  he  Hindu  or  Mohammedan,  hates 
nothing  so  much  as  accepting  charity.  The  middle 
class  Hindu  would  rather  die  than  let  his  wants  be 
known  and  relieved  by  a  stranger.  This  systematic  re- 
lief of  the  British  is  undermining  the  innate  fineness 
of  feeling  and  converting  the  people  into  a  horde  of 
"  shameless  beggars  "  (according  to  English  interpre- 
tation). It  is  true  the  money  spent  in  famine  relief 
comes  from  the  pockets  of  Indians,  it  is  all  money 
that  has  been  wrung  from  the  people  at  one  time  or 
another,  in  various  ingenious  ways.  But  all  the  masses 
feel  and  know  is  that  they  receive  charity  in  small 
doles ;  it  is  that  consciousness  that  demoralises  them. 
Says  Mr.  J.  Ramsay  MacDonald,  M.P.,  in  his 
"  Awakening  of  India  " : 

"  In  their  strenuous  efforts  to  provide  relief  when 
famine  is  upon  the  land,  our  officers  are  above  praise. 
The  story  of  famine  relief  in  India  will  shine  with  a 
bright  glow,  after  many  other  achievements  of  ours 

'  For  the  famine  relief  measures  of  native  governments  in 
pre-British  days,  see  A.  Loveday's  work  on  "  The  History 
and  Economics  of  Indian  Famines,"  pp.  102  and  103. 


278  ENGLAND'S  DEBT  TO  INDIA 

have  ceased  to  emit  a  beam  of  light.  .  ,  .  Yet  this  re- 
hef  work,  so  unhke  the  charity  which  India  has  been 
accustomed  to  dispense,  has  had  a  solvent  effect  on 
Indian  social  organisation.  It  tends  to  pauperise  the 
people,  to  make  them  lose  their  self-respect;  it  dam- 
aged the  status  of  some;  it  destroyed  the  morals  of 
others.  Indeed  the  coarsening  and  degrading  effects 
which  come  from  relief  works  are  the  same  in  India 
as  they  are  at  home." 

The  present  writer  has  had  personal  experience  in 
famine  relief,  having  organised  private  relief  works  for 
orphans  and  other  famine  stricken  people,  during  three 
of  the  most  disastrous  of  these  periods  that  occurred 
within  the  last  twenty-five  years:  the  famines  of  1897, 
1899  ^"*^  1907-98.  He  travelled  widely  over  famine- 
stricken  areas  in  the  superintendence  of  relief,  and 
can  assert  from  personal  experience  that  the  "  coarsen- 
ing and  degrading,"  and  the  utter  demoralisation  that 
results  from  the  British  system  of  famine  relief,  beg- 
gars description.     Mr.  MacDonald  adds: 

"  Over  and  over  again.  Government  has  been  warned 
that  its  duty  is  not  to  relieve,  but  to  prevent,  and  the 
only  way  to  prevent  is  to  strengthen  the  economic  posi- 
tion of  the  cultivator,  mainly  by  extricating  him  from 
the  financial  meshes  in  which  he  lives,  and  to  give 
support,  as  far  as  possible,  to  the  old  economy  by  en- 
couraging its  methods  of  mutual  helpfulness." 

Let  us  examine  what  has  been,  or  is  being  done,  by 
way  of  prevention. 

Building  of  Railways.  "  In  one  way,"  says  Mr. 
MacDonald,  "  railways  have  added  to  the  difficulty  and 
have  widened  the  apparent  famine  area.  In  the  first 
place,  they  are  the  means  by  which  the  export  of  In- 


FAMINES  AND  THEIR  CAUSES       279 

dian  grain  is  carried  on.  No  one  who  has  not  been  in 
India  and  seen  the  workings  of  the  system,  from  the 
great  granaries  at  Karachee  to  the  agencies  in  every 
Httle  village  having  a  surplus  of  anything  to  be  sent 
away,^  can  grasp  the  colossal  nature  of  the  export  or- 
ganisation. One  firm  alone  saps  the  blood  of  Indian 
life  like  a  tropical  sun,  leaving  dust  and  barrenness 
(it  might  be  added,  destitution)  behind. 

"  A  week  or  two  after  harvest,  India's  surplus  ( ?) 
wheat  and  rice  have  passed  into  the  hands  of  dealers, 
and  when  the  monsoon  fails,  she  starves.  The  cul- 
tivator used  to  have  reserves.  He  has  practically  none 
now.  He  has  a  little  money,  but  not  much,  and  it  is 
just  this  turning  everything  into  cash  which  is  the 
source  of  so  much  of  his  trouble.^  When  famine  over- 
took India  in  olden  times,  if  the  famine  stricken  tract 
was  in  distress,  neighbouring  tracts  were  little  affected, 
owing  to  lack  of  communication,  thus  preventing  fam- 
ine influences  from  affecting  neighbouring  markets. 
The  means  which  relieve  famine  widen  its  influence, 
because  scarcity  in  one  part  immediately  puts  up  prices 
in   another,   and   deepens   poverty   everywhere.     The 

*  The  qualification  is  superfluous,  since  agencies  are  estab- 
lished in  villages  which  produce  large  quantities  of  grain,  ir- 
respective of  whether  they  have  a  surplus  to  be  sent  away. 
Crops  are  sometimes  sold  before  they  ripen.  As  a  rule,  they 
are  purchased  when  the  harvest  is  in. 

^  But  this  turning  of  resources  into  cash  helps  the  British 
manufacturer  and  enables  the  British  report  writer  to  talk  of 
the  prosperity  of  the  cultivator,  shown  by  his  consumption  of 
British  goods.  The  money  left  over  from  indebtedness,  if  there 
be  any,  is  spent  in  buying  clothes,  cigarettes,  wine,  etc.,  all 
British  importations,  and  within  a  few  weeks  after  the  harvest, 
the  cultivator  wakes  to  find  himself  on  the  verge  of  starvation. 
As  to  the  effect  of  railways  on  the  destruction  of  the  native 
industries  and  the  concentration  of  labour  on  agriculture,  see 
Loveday,  p.  107. 


28o  ENGLAND'S  DEBT  TO  INDIA 

poison  which  used  to  be  virulent  but  local,  is  now 
milder  but  carried  further  through  the  system." 

Says  Sir  B.  Fuller  in  "  The  Empire  of  India  "  (Lon- 
don, 1913),  "Railways  blunt  the  edge  of  famine  but 
by  equalizing  prices  cause  general  distress"  (p.  67). 
He  also  remarks  that  during  an  Indian  famine  two- 
thirds  of  the  Indian  population  lose  their  means  of 
livelihood.     See  also  A.  Loveday,  p.   107. 

Building  of  Canals  and  Irrigation  Works.  The  fam- 
ine commission  of  1878  recommended  the  building  of 
canal  and  irrigation  works  as  the  most  important  step. 
This  work  was  neglected,  comparatively  speaking,  for 
a  considerable  period,  and  has  only  within  this  cen- 
tury received  some  attention.  The  figures  of  profits 
made  by  these  canals  tell  their  own  astounding  tale ; 
the  prices  which  the  Government  charges  to  reap  such 
profits,  can  only  be  exorbitant.  Mr.  Thorburn,  the  re- 
tired Financial  Commissioner  of  the  Punjab,  states  in 
his  book,  "  The  Punjab  in  Peace  and  War,"  written  in 
1904: 

"  The  annual  net  return  on  the  outlay  on  canals  now 
averages  11  per  cent,  and  in  another  decade  may  rise 
to  18  per  cent.  The  Chenab  Canal  already  gives  this 
rate  of  interest."     (Page  275.) 

The  eastern  Jumna  Canal  has  been  yielding  a  net 
revenue  of  from  20  to  25  per  cent,  throughout  the 
decade  1901-11.  The  lower  Chenab  Canal  yielded 
a  net  revenue  of  34.06  per  cent,  on  the  capital  invest- 
ment in  1911-12.  These  figures  show  how  relentlessly 
the  water  rates  are  assessed.  In  canal-irrigated  areas, 
the  cultivator  has  to  pay  three  taxes:  (a)  Ordinary 
land  revenue,     (b)  A  water  rate  graded  on  the  in- 


FAMINES  AND  THEIR  CAUSES       281 

crease  in  price  and  productivity  of  the  land  caused  by 
its  inclusion  in  a  canal  zone, —  called  in  Hindusthani, 
"  Khush  haisiyyati"  or  "water-advantages."  (c) 
The  price  of  the  water  actually  used. 

Pressure  on  Land.  Mr.  Gait,  I.  C.  S.,  admits 
frankly  in  his  report  on  the  census  of  191 1  that  "  there 
seems  to  be  no  doubt  that  the  number  of  persons  who 
live  by  cultivation  is  increasing  at  a  relatively  rapid 
rate."  Reviewing  the  increase  or  decrease  of  persons 
employed  in  industries  he  notices  a  fall  of  6.1  per  cent, 
in  the  number  of  persons  supported  by  textile  indus- 
tries only  during  the  decade  1901-11.  There  has  been 
a  similar  decrease  in  the  hides  and  skin  industry  and 
in  workers  in  metals. 

In  191 1  there  were  71 13  factories  in  British  India 
employing  2.1  million  persons  out  of  a  total  popula- 
tion of  244  millions,  or  9  per  mille.  Of  these,  two- 
fifths  of  the  total  number  were  employed  in  growing 
special  products,  558,000  in  textile  industries,  224,000 
in  mines,  125,000  in  transport,  74,000  in  food  in- 
dustries, 71,000  in  metal  industries,  49,000  in  glass  and 
earthenware  industries,  the  same  number  in  industries 
connected  with  chemical  products,  and  45,000  in  in- 
dustries of  luxury. 

The  Opening  of  Agricultural  Banks.  This  step  was 
advocated  as  far  back  as  1884,  arid  was  promptly  re- 
jected by  the  Secretary  of  State.  After  a  good  deal  of 
delay,  cogitation  and  discussion,  village  co-operative  so- 
cieties were  started  in  1904.  These  are  now  to  be 
found  in  every  province  "  in  a  state  of  more  or  less 
vigour."  In  1914  there  were  14,566  Co-operative 
Credit  Societies  in  India,  of  which  13,715  had  been 


282  ENGLAND'S  DEBT  TO  INDIA 

started  to  provide  agricultural  credit.  In  an  article 
contributed  to  the  Calcutta  Review  Sir  D.  Hamilton 
states  the  total  membership  of  the  Co-operative  Credit 
Societies  as  750,000  with  a  capital  of  £5,000,000.  Very 
properly  he  calls  it  a  "  mere  drop  in  the  ocean." 

Special  Agrarian  Legislation.  As  a  palliative  for 
the  heavy  indebtedness  of  the  agriculturist,  the  result 
of  a  too-rigorous  revenue  system,  a  land-alienation  act 
has  been  passed  in  the  Punjab,  prohibiting  alienation 
of  land  by  members  of  agricultural  tribes,  specially 
notified  by  the  local  government, —  except  to  members 
of  the  same  or  other  tribes  so  notified.  This  measure 
is  of  extremely  doubtful  utility.  It  has  been  de- 
nounced by  British  officers  as  unsound  and  mischiev- 
ous, in  its  likehhood  to  absorb  the  holdings  of  many 
small  peasant-proprietors  into  those  of  a  few  big  land- 
lords. There  is  a  keen  controversy  over  it,  in  the 
Punjab,  but  there  is  not  space  enough  to  include  the 
arguments  for  or  against  it  here.  As  a  measure  of 
famine  prevention,  it  is  useless. 

The  official  reports  give  frequent  expression  to  the 
growing  prosperity  of  India,  which  are  apt  to  mislead 
those  who  do  not  bear  in  mind  real  conditions  of  acute 
distress.  The  Blue  Book  for  1904-05  says  of  the  dis- 
tricts of  Agra  and  Oude :     "  The  year  ending  Sept. 

30,    1904,   WAS  THE  LAST  OF  A  SERIES  OF  FAT  YEARS  !  " 

These  provinces  had  several  famines  in  1896-97-99 
and  1900-01.  This  reduces  the  "series"  to  two  or 
three  years.  Such  general  statements  of  prosperity 
made  in  official  reports  should  be  read  with  a  great  deal 
of  discrimination,  if  not  with  actual  distrust. 


'   CHAPTER  XI 

RAILWAYS  AND  IRRIGATION 

The  Government  Policy.  The  railway  policy  of  the 
Government  of  India  has  been  a  subject  of  contro- 
versy between  Indian  and  British  publicists  as  well  as 
among  the  latter  inter  se.  The  Indian  publicists  are 
almost  unanimous  that  the  railways  in  India  built  and 
constructed  with  foreign  capital  and  managed  by  for- 
eign agents,  have  been  economically  ruinous  to  India, 
and  the  British  publicists  are  divided  into  two  classes : 
those  who  condemn  the  railway  policy  of  the  Govern- 
ment of  India  and  those  who  point  out  in  figures  of 
traffic  and  the  growth  of  foreign  trade  conclusive  facts 
showing  the  success  of  railways  there.  But  before  we 
state  the  case  for  both  sides  we  want  to  say  once  for 
all,  that  although  there  is  no  doubt  in  our  judgment 
that  the  railway  policy  of  the  Government  of  India 
has  been  the  source  of  indescribable  misery  to  the 
people  of  India,  economically  and  financially  the  rail- 
ways have  largely  contributed  to  the  unifying  of  In- 
dia, and  to  the  growth  of  national  consciousness ;  they 
have  broken  down  social  barriers  ;  they  have  facilitated 
travel  and  thereby  helped  social  reform  and  in  the 
broadening  of  the  Indian  people's  outlook.  Unfortun- 
ately the  price  we  have  paid  for  these  benefits  has  been 
too  heavy  for  a  poor  people  like  those  of  India.  With 
these  preliminary  remarks  we  will  proceed  first  to  give 

283 


284  ENGLAND'S  DEBT  TO  INDIA 

some  outstanding  facts  about  Indian  railways  and  then 
discuss  tiieir  bearing  on  Indian  economics. 

The  length  of  railway  lines  open  on  March  31,  1915, 
was  35,285 ;  the  mileage  under  construction  at  the  end 
of  1914-15  was  437.  The  number  of  passengers  car- 
ried in  1914-15  was  451  millions  and  the  tonnage  of 
goods  81  millions. 

The  following  tables  compiled  by  Mr.  Dora  Swami, 
an  Indian  publicist,  and  verified  by  us  will  be  found 
useful.  (Vide  Hindnsthan  Review,  Allahabad,  Janu- 
ary, 1916.) 

Comparative  Table  of  Figures  of  Foreign  Trade. 

Total  Imports  Exports 

Millions  Millions  Millions 

1913  United  States  of  America  .     862           362  500 

1913  United  Kingdom 1403            769  634 

191 1  Germany    942            510  432 

191 1  France 712            392  320 

1913  India  290            127.5  162.5 

1911  Russia 270            114  156 

Comparative  Table  of  Traffic. 

Passengers  Goods 

Carried  Carried 

1910  United  Kingdom 1240  millions    489  millions  Ions 

1910  United  States  of  Amer- 
ica         971         "  1849        "            " 

1910  Germany    1541         "  576        "            " 

191a  France    509         "  173        "            " 

1910  Austria-Hungary    409         "  217        "            " 

1916  India    451         "  81 

Comparative    Table   Shozving   Mileage    of   Railways, 
National  Wealth  and  National  Income  of 
Different  Countries. 

Wealth  Income 

Railways       Millions  Millions 
Miles              of  £  of  £ 

United   States  of  America.  .     252,000  39,124  5000 

Germany    39,Soo  20,000  2000 


RAILWAYS  AND  IRRIGATION         285 

Wealth  Income 

Railways  Millions  Millions 

Miles  of  £  of  £ 

Russia 50,000  13,000  1000 

India  35,300  3,500  600 

France    32,000  1 1,675  1460 

Canada    29,300  2,072  259 

The  United  Kingdom 23,400  16,500  2140 

Austria  Hungary   29,200  12,500  1400 

Australia   20,000  1,312  164 

Italy    11,100  8,000  800 

New  Zealand  320  40 

Per  Capita  Wealth  and  Income. 

Wealth  in  Income  in 

Pounds  Pounds 

The  United  States  of  America              391  50 

Germany    366  47 

The  United  Kingdom  320  40 

New  Zealand 294  38 

France    292  ^3 

Australia   262  32 

Canada  259  29 

Austria  Hungary  240  27 

Italy    228  23 

Russia 76  9 

India  II  1.9 

or  say  2 

These  figures  tell  their  own  tale  —  while  in  the  mat- 
ter of  national  wealth  and  national  income,  India  is 
at  the  bottom  of  the  list,  in  the  matter  of  railway 
mileage  she  is  fourth. 

The  Beginning  of  Railway  Policy.  We  have  not 
the  space  to  give  even  a  brief  history  of  the  railway 
policy  of  the  Government  of  India  and  of  the  history 
of  railway  progress  in  that  country.  The  subject  may 
well  be  studied  in  Mr.  Horace  Bell's  book  on  "  Railway 
Policy  in  India"  (Revington,  Perceval  &  Co.,  Lon- 
don, 1894)  as  also  in  Thornton's  "  Public  Works." 

In  the  former  "  the  author  has  designedly  abstained 
from   criticism   and   from  the  assertion  of   his  own 


286  ENGLAND'S  DEBT  TO  INDIA 

views,"  though  reading  between  the  lines  one  can,  in 
places,  guess  the  author's  opinion.  For  example,  on 
the  very  first  page  discussing  the  beginning  of  the  rail- 
way policy  in  1843-44,  the  author  remarks: 

"  Thus  apart  from  the  comparative  novelty  of  rail- 
ways even  in  Europe  and  in  face  of  much  more  serious 
and  urgent  matters,  it  would  not  have  been  surprising 
if  the  '  Honourable  Board '  in  Leadenhall  Street,  had 
regarded  the  proposals  as  untimely  or  premature. 
This,  however,  does  not  appear  to  have  been  the  view 
taken  at  any  time  either  at  home  or  in  India,  and  not- 
withstanding that  much  more  weighty  business  was  in 
hand,  the  railway  promoter  found  himself  in  favour 
and  a  desire  shown  to  help  rather  than  retard  the  prog- 
ress of  the  scheme." 

The  first  guaranteed  Indian  railway  was  formed  in 
1849-50  and  "  during  the  next  thirty  years  the  sum  of 
over  £99,000,000  was  raised  in  the  English  market 
under  the  security  of  the  Indian  Government's  guar- 
antee of  5  per  cent.  As  up  to  the  year  1877  the  net 
earnings  of  these  railways  were  not  sufficient  to  pay 
the  guaranteed  interest,  the  State  had  to  advance  the 
sum  required  out  of  the  ordinary  budget.  These  ac- 
cumulated arrears  of  interest  amounted  in  1881  to  the 
enormous  sum  of  £28,425,119." 

All  authorities,  Indian  and  Anglo-Indian,  are  agreed 
that  the  first  period  of  railway  construction  from 
1849-50  to  about  1873  was  characterised  by  gross  ex- 
travagance and  other  abuses  which  were  fully  ex- 
posed before  the  Finance  Committees  of  1871,  1872, 
1873  and  1874.  It  was  then  resolved  that  the  State 
should  undertake  construction  with  borrowed  capital. 


RAILWAYS  AND  IRRIGATION         287 

In  1873  an  official  chronicler  predicted  "  the  cessation 
of  heavy  outlay  on  construction."  In  1878  Sir  Arthur 
Cotton  recommended  "  the  summary  and  indefinite  sus- 
pension of  nearly  all  railway  schemes  and  works."  In 
1880  the  Famine  Commission  pleaded  for  larger  outlay 
on  works  of  irrigation  as  compared  with  railways.  But 
all  these  predictions  and  hopes  and  recommendations 
came  to  nothing,  because  the  interests  of  the  British 
merchant  and  manufacturer  demanded  the  extension 
of  railways,  and  after  all  they  are  the  men  whose  opin- 
ions count  in  England.  The  progress  in  railway  con- 
struction may  be  judged  from  the  fact  that  while  up 
to  1880  only  9,310  miles  of  railway  had  been  con- 
structed, by  1900  the  mileage  had  risen  to  about  25,000 
miles.  In  March,  1915,  it  stood  at  35,285.  In  the 
twenty  years  from  1880  to  1900  more  than  15,000  miles 
of  railway  was  constructed  as  against  less  than  10,000 
in  the  preceding  thirty  years,  and  in  the  next  fifteen 
years  more  than  10,000  miles  more  were  added. 
Writing  of  the  railway  policy  of  the  Government  of 
India,  the  Honourable  Mr.  D.  E.  Wacha,  the  ablest 
Indian  authority  on  finances,  said : 

"  At  the  very  outset  we  cannot  help  remarking  that 
the  breathless  pace  at  which  capital,  like  water,  has 
been  expended  during  the  last  few  years,  at  the  behest 
of  the  interested  Chambers  of  Commerce,  is  not  only 
inordinate  but  most  improvident.  The  entire  railway 
policy  of  the  Government,  specially  in  its  financial  as- 
pect, demands  the  most  searching  investigation  by  an 
impartial  tribunal  of  experts  wholly  independent  of 
influence  at  Calcutta  and  Whitehall.  We  are  con- 
fident it  would  reveal  facts  which  would  certainly  not 
redour^d  to  the  credit  of  the  Government.  Indeed, 
even  on  the  recorded  evidence  taken  by  the  East  India 


288  ENGLAND'S  DEBT  TO  INDIA 

Finance  Committee  of  1871-74,  better  known  as  the 
Fawcett  Committee,  there  is  ample  material  to  con- 
demn the  policy  of  the  State.  Huge  blunders  were 
made  entailing  colossal  expenditure  on  the  tax-payer 
which  were  held  to  be  culpable.  The  student  of  rail- 
way finance  has  to  dive  deep  into  those  old  but  most 
important  records  to  corroborate  the  statement  we 
make  here. 

"  The  worst  and  most  inexcusable  feature  of  Indian 
railway  policy  is  the  supreme  indifference  and  neglect 
of  the  authorities  to  the  crying  wants  and  wishes  of 
the  Indian  public  —  those  vast  millions  of  the  popula- 
tion who  travel  about  2)^  miles  in  a  year  and  who  now 
contribute  the  largest  portion  of  the  coaching  traffic 
amounting  to  13  crore  ^  rupees  per  annum.  The  in- 
terests of  the  European  mercantile  community  are 
deemed  of  paramount  importance  zvhile  those  of  the 
Indian  population  at  large  have  been  uniformly  held 
of  secondary  importance,  if  at  all.  At  the  beck  and 
nod  of  the  former,  with  their  screaming  organs  of 
opinion  behind,  the  Government  readily  spend  millions 
like  water  on  railways  without  an  ultimate  thought 
of  the  tax-payers  and  the  return  such  capital  would 
give.  It  is  the  greatest  blot  on  Indian  railway  ad- 
ministration that  it  ignores  the  interests  of  the  per- 
manent population  and  is  eager  to  satisfy  first  the  cry 
of  the  interested  and  migratory  European  merchant. 
No  private  railway  enterprise  would  spend  such  enor- 
mous sums  of  money  and  no  proprietary  body,  how- 
ever rich  and  influential,  would  tolerate  in  any  part  of 
the  civilised  world,  the  loans  after  loans,  ranging  from 
15  to  20  crores,  which  are  annually  borrowed  and  ex- 
pended without  let  or  hindrance,  save  for  a  kind  of 
official  control,  which  is  no  control  at  all  .  .  .  It  is  a 
dismal  tale,  the  history  of  Indian  railway  finance  from 
first  to  last.     As  a  matter  of  fact  it  is  recorded  in 

^  A  Crore  is  ten  millions  and  a  Rupee  is  valued  roughly  at 
33  cents  of  American  money. 


RAILWAYS  AND  IRRIGATION         289 

black  and  white  in  one  of  the  important  appendices  to 
the  report  of  the  Royal  Commission  on  Indian  expend- 
iture (1896-97),  generally  called  the  Welby  Commis- 
sion, that  from  1848  to  1895,  the  whole  system  of  In- 
dian railways  cost  to  the  State,  that  is  the  tax-payer, 
fully  55  crore  rupees ;  and  though  since  that  date  there 
have  been  gains,  still,  in  the  railway  ledger  of  the 
Government  of  India  there  is  a  debit  balance  against 
railways  of  as  many  as  40  crore  rupees. 

"  It  is  since  1899-1900  that  Indian  railways  have 
turned  the  corner  and  earned  something  for  the  tax- 
payer on  his  colossal  capital  recorded  in  the  Adminis- 
tration Report  for  1910  at  430  crore  rupees!  The 
average  gain  since  1904-05  has  come  to  3  crore  rupees 
per  annum.  There  are  no  doubt  paying  railways ;  but 
there  are  also  losing  ones  and  these  3  crores  are  the 
net  balance  of  gain  after  writing  out  the  losses.  The 
large  gains  of  the  earning  railways  are  absorbed  by 
the  losing  ones,  as  could  be  easily  discovered  on  a  ref- 
erence to  appendix  9  of  the  annual  administration  re- 
port which  gives  the  financial  operations  of  each  sys- 
tem of  railways. 

"  Meanwhile,  let  us  mark  the  progress  of  this  Rail- 
way rake  during  the  decade.  Perhaps  the  best  way 
would  be  to  exhibit  the  most  salient  features  worth 
knowing  and  weighing  in  the  following  table : 

jpoi  igjo 

Capital  outlay,  crores  of  Rs.         339-17  439-04 

Gross  earnings,  crores  of  "  33.60  45-76 

Working  expenses,  crores  of "  15-75  25.16 

Percentage    of    working    expenses 

to  gross  earnings,  crores  of  .. .      "  46.79  53- 10 

Net  earnings,  crores  of  "  17.88  20.60 

Percentage    of    net    earnings    on 

capital  outlay 5.27  5.46 

Net  gain  to  the  State,  that  is  to  the 
general  tax-payer  after  deduct- 
ing interest  on  loans  borrowed 
for  capital  and  other  indirect 
charges,  crores  of  "  1.27  2.75 


290  ENGLAND'S  DEBT  TO  INDIA 

Percentage    of    net   gain    on    total  igoi  1910 

capital  outlay,  that  is  to  say,  the 

rate  of  dividend  earned  by  the 

State  or  the  tax-payer  on  the 

total  capital    0.38  0.62 

No.  of  miles  open   25,370  36,064 

No.  of  passengers  carried  I947  37-iS 

Passenger  earnings,  crores  of Rs.  10.07  17.12 

Goods  traffic,  crores  of  tons 4.34  6.50 

Goods  earnings,  crores  of  "  21.24  30.43 

No.  of  European  employees 5493  7.4i  i 

No.  of  Eurasian  employees   8,175  9-583 

No.  of  Indian  employees  353,278  526,499 

"  The  first  fact  that  strikes  one  is  the  increase  in  cap- 
ital outlay.  Capital  was  increased  in  10  years  from 
339  to  439  crore  rupees,  that  is  by  100  crores,  equiva- 
lent to  30  per  cent.  Next,  while  the  gross  earn- 
ings increased  by  12.16  crore  rupees  or  36.20  per 
cent.,  the  gross  working  charges  increased  by  60  per 
cent. !  That  is  to  say,  the  working  charges  progressed 
at  almost  double  the  ratio  of  gross  earnings !  But  how 
stand  the  net  earnings,  that  is,  gross  earnings  minus 
gross  working  charges?  The  increase  amounted  to 
2.72  crore  rupees  in  10  years  equivalent  to  15.30  per 
cent.,  say  1.5  per  cent.,  per  annum.  Can  it  be  said 
that  this  growth  of  net  earnings  at  the  rate  of  1.5 
per  cent,  per  annum  is  commensurate  with  the  growth 
of  capital  outlay  at  3  per  cent.?  It  should  take  away 
the  breath  of  any  railway  capitalist  with  an  economic 
conscience.  Here  practically  may  be  seen  the  eco- 
nomic phenomenon  which  in  agricultural  industry  is 
called  the  law  of  diminishing  returns.  Increased  out- 
lay does  not  mean  proportional  increase  of  income. 
Moreover,  with  a  larger  growth  of  capital,  even  that 
income  must  later  on  diminish !  This  evidently  will 
be  the  financial  result  if  capital  is  added  to  capital 
blindly  like  Ossa  on  Pelion  from  year  to  year.  It 
should  be  remembered  that  these  net  earnings  do  not 
take  into  account  the  enormous  interest  which  has  to 
be   annually   paid   on   the   borrowed   railway   capital. 


RAILWAYS  AND  IRRIGATION        291 

When  that  interest  and  other  indirect  charges  are  de- 
ducted as  any  banker,  merchant  or  man  engaged  in 
business  should  do,  the  net  gain,  the  true  net  gain  or 
dividend  to  the  shareholder,  who  is  in  reality  the  tax- 
payer as  represented  by  the  State,  was  only  1.27  crore 
rupees  in  1901  and  2.75  crore  rupees  in  1910.  Or,  to 
put  it  in  another  way,  the  percentage  in  the  former 
year  was  only  0.38  per  cent,  and  in  the  latter  0.62  per 
cent,  on  the  respective  colossal  capital.  Let  the  reader 
just  imagine  a  paltry  percentage,  a  little  over  ^  per 
cent.,  and  a  little  under  ^  per  cent. !  Here  may  then 
be  discerned  the  iinal  financial  result  to  the  taxpayer. 
How  miserable  compared  to  even  2^  and  3  per  cent, 
of  railways  by  private  enterprise  elsewhere.  In  the 
case  of  private  enterprise  there  are  a  number  of  joint 
proprietors  of  a  railway.  In  the  case  of  the  State, 
which  represents  the  tax-payer,  there  is  only  one  pro- 
prietor. Beyond  that  there  is  no  difference.  But 
when  the  joint  stock  railway  company,  after  providing 
for  all  charges  and  interest  on  borrowed  monies,  di- 
vides among  its  proprietors  in  the  United  Kingdom 
and  elsewhere  a  dividend  on  its  share  of  capital,  say 
2>2  to  3  per  cent,  at  the  lowest,  here  in  India,  the 
dividend  goes  a  little  beyond  half  a  per  cent.!  Thus 
though  Indian  railways  show  progress  generally,  the 
ultimate  financial  progress  is  indeed  most  disappoint- 
ing. The  only  satisfactory  feature  is  the  growth  of 
coaching  and  goods  trafiac.  The  number  of  passen- 
gers increased  by  fully  17.68  crores  in  10  years,  say, 
at  the  rate  of  1.76  crore  per  annum.  The  growth  is 
equal  to  90  per  cent,  in  the  decade,  while  the  percent- 
age of  increase  shown  in  coaching  receipts  came  to 
70.  Goods  traffic  showed  an  increase  in  receipts  of 
9.19  crore  rupees,  equivalent  to  43.26  per  cent.  Of 
course,  it  goes  without  saying  that  with  10,691  more 
miles  of  new  railways  open  or  under  construction, 
the  number  of  all  classes  of  employes  should  in- 
crease. The  total  increase  was  176,577,  say  at 
the     rate     of     17,657     per     year.    The     European 


292  ENGLAND'S  DEBT  TO  INDIA 

employes  increased  by  35,  the  Eurasians  by  17,  and 
the  Indians  by  50  per  cent.  But  the  railzvay  authori- 
ties have  for  years  deliberately  suppressed  the  salaries 
and  wages  annually  earned  by  each  class  of  em- 
ployes." 

While  the  railway  administration  reports  and  the 
government  blue  books  repeat  every  year  the  num- 
ber of  Europeans  and  Indians  employed  on  Indian 
railways  they  have  persistently  omitted  to  state  the 
amount  paid  to  the  classes  in  salaries.  According  to 
the  parliamentary  return  of  salaries  of  May  17,  1892, 
there  were,  in  all,  2,448  Europeans  earning  salaries  of 
1,000  rupees  (333  dollars)  and  upwards  per  annum 
in  the  civil  and  military  employ  of  the  Government  of 
India.  Their  total  salaries  came  to  R.  8,062,840. 
There  were,  however,  only  895  natives  who  earned 
salaries  of  R.  1,000  or  upwards  per  annum  and  the 
total  of  these  salaries  amounted  to  R.  1,367,350.  It 
will  be  very  interesting  to  have  similar  information 
about  railway  employes.  In  discussing  the  blessings 
conferred  on  India  by  the  railway  system,  the  Anglo- 
Indian  imperialist  is  apt  to  point  out : 

(a)  The  huge  growth  of  the  foreign  trade  of  the 

country. 

(b)  The  number  to  whom  the  railways  give  employ- 

ment. 

(c)  The  help  which,  in  years  of  scarcity,  the  rail- 

ways afford  in  carrying  the  surplus  produce 

of  one  province  to  another. 
Whether   (a)    is  a  blessing  or  not  depends  on  who 
profits  by  the  foreign  trade.     We  have  already  shown 
that  the  foreign  trade  is  in  the  hands  of  the  Euro- 


RAILWAYS  AND  IRRIGATION        293 

peans,  and  while  they  purchase  Indian  produce  on 
their  own  terms,  they  convert  it  into  manufactures 
and  resell  the  same  to  India,  also  on  their  own  terms, 
pocketing  all  the  profits  which  accrue  from  manufac- 
ture, carriage,  insurance,  brokerage,  etc.  As  to  (b), 
the  number  of  natives  employed  by  the  Indian  rail- 
ways cannot  be  by  any  means  larger  than  what  were 
employed  in  the  transportation  business  on  land  and 
waterways  before  the  railways.  The  railways  have 
practically  displaced  both.  As  to  (c),  in  this  respect 
the  railways  have  been  more  of  a  curse  than  a  blessing. 
They  have  helped  in  the  export  of  grain  more  than 
the  needs  of  the  Indian  population  warrant.  Sir  W. 
W.  Hunter  has  left  it  on  record  that  if  every  Indian 
were  to  have  two  full  meals  every  day  there  would  be 
left  much  less  to  export  than  is  at  present  exported. 
The  export  of  food  stuffs  has  raised  prices,  without 
raising  the  wages  of  labourers  to  the  same  extent.  The 
rise  in  prices  has  been  one  of  the  potent  causes  of  the 
increase  in  land  revenue,  which  in  its  turn  compels  the 
peasant  to  sell  his  crops  at  the  price  offered  by  the 
exporter.  All  this  adds  to  the  income  of  the  railways. 
Writes  Mr.  A.  K.  Connell :  ^ 

"  To  sum  up,  the  joint  results  of  railways  and  free 
trade  may  be  briefly  stated  in  this  way :  India  used 
to  clothe  itself,  now  England  sends  clothes,  and  Indian 
weavers  have  lost  an  enormous  source  of  income,  with 
the  gain  to  the  country  of  the  difference  in  price  be- 
tween English  and  Indian  goods.  But  to  pay  for  these 
goods  India  has  to  export  vast  quantities  of  food  and 
those  who  sell  this  food  make  larger  profits  than  be- 
fore.    Therefore  a  certain  portion  of  the  community 

2 "  The  Economic  Revolution  of  India  and  the  Public  Works 
Policy,"  p.  53. 


294  ENGLAND'S  DEBT  TO  INDIA 

gain  by  cheaper  cotton  goods  and  higher  prices  for 
grain.  But  in  order  to  attain  this  result  they  have  had 
to  pay  the  sums  before  mentioned  to  build  the  rail- 
ways. Besides  that,  they  have  to  support  in  years  of 
scarcity  a  gigantic  system  of  outdoor  relief.  Is  it  not 
obvious  that,  taking  the  economic  changes  as  a  whole, 
the  country  has  lost  an  enormous  source  of  wealth? 
If  the  import  of  cotton  to  India  and  the  export  of  grain 
from  India  ceased  to-morrow,  the  Indian  people  would 
be  the  gainers,  though  the  Indian  Government  would 
be  at  its  wit's  end.  In  fact,  the  interests  of  the  two 
are  not  identical.  The  Indian  Government  is  now  do- 
ing its  best  to  stimulate  the  export  of  wheat  in  order 
to  lessen  its  '  loss  by  exchange ' ;  but  this  will  only  re- 
sult in  higher  food  prices  in  India.  We  now  see  the 
explanation  of  Mr.  Hunter's  assertion  that  two-fifths 
of  the  people  of  British  India  enjoy  a  prosperity  un- 
known under  native  rule ;  other  two-fifths  earn  a  fair, 
but  diminishing,  subsistence;  but  the  remaining  fifth, 
or  forty  millions,  go  through  life  on  insufficient  food. 
And  in  ten  years,  according  to  Mr.  Caird,  there  will  be 
twenty  millions  more  people  to  feed.  Can  it,  then,  be 
maintained  that  the  material  condition  of  India  has 
been  improved  by  the  enormous  outlay  on  railways? 

"  But  you  forget,  replies  the  opponent  of  these  her- 
etical views,  that  in  time  of  famine  the  railway  brings 
food  to  starving  districts.  What  would  have  become 
of  the  people  of  Madras,  Bombay,  and  the  North- 
West  Province  during  the  last  famine  if  it  had  not  been 
for  the  railways?  My  reply  is:  What  did  become  of 
them  ?  It  is  true,  the  railways  brought  grain  ;  yet  they 
had  previously  taken  it  away,  and  they  brought  it  back 
at  a  quadrupled  price,  and  the  Government  had  to 
spend  millions  of  pounds  to  enable  the  peasants  to  buy 
it,  and  even  then  could  not  prevent  frightful  mortality. 
What  has  been  the  native's  custom  from  time  im- 
memorial of  providing  against  bad  years?  Why,  the 
simple  method  of  Joseph  in  Egypt  —  that  of  storing 


RAILWAYS  AND  IRRIGATION         295 

grain.  This  is  what  the  official  report  on  the  Mysore 
famine  tells  us : 

"  *  The  country  had  suffered  in  former  years  from 
deficient  rainfall,  but  actual  famine  had  been  staved 
off  by  the  consumption  of  the  surplus  ragi,  a  coarse 
millet,  stored  in  underground  pits,  from  which  it  is 
withdrawn  in  times  of  scarcity,  as  the  grain  will  keep 
sound  and  good  for  forty  and  fifty  years.'  Only  two 
of  the  Famine  Commissioners,  Messrs.  Caird  and  Sul- 
livan, seem  to  have  recognised  the  importance  of  this 
custom.  In  the  above-quoted  very  interesting  appen- 
dix to  the  first  part  of  the  report,  they  write  on  the 
subject  of  grain  storage  as  follows:  'The  food  of 
the  people  is  of  the  simplest  kind,  grain,  salt,  and  a 
few  condiments  for  a  relish.  The  grain  is  easy  to  han- 
dle, bears  storage  in  pits  for  many  years,  and  the 
people  themselves  grind  it  as  they  require  it.  The 
pits  are  made  in  the  ground,  in  a  manner  with  which 
the  natives  are  familiar,  and  cost  nothing  beyond  the 
encircling  ring  of  baked  clay  and  labour  in  construc- 
tion.* It  is  this  storage  of  grain,  the  easiest  kind  of 
Famine  Insurance  Fund,  that  the  teachings  of  plain 
experience  have  forced  the  native  to  adopt  throughout 
the  length  and  breadth  of  India,  though  the  amount  of 
stores  varies  according  to  the  necessities  of  each  dis- 
trict. 

"  Since  the  introduction  of  railways  there  is  reason 
to  believe  that  the  ryot,  tempted  by  immediate  gain,  or 
forced  by  taxation  to  sell  his  grain,  is  beginning  to 
store  rupees  instead  of  food ;  but,  as  he  cannot  eat  his 
rupees  or  jewelry,  and  cannot  buy  fuel  so  as  to  keep 
the  manure  for  the  land,  and  has,  according  to  the 
Famine  Commissioners,  to  give  in  famine  times  a  quad- 
rupled price  for  his  food,  it  is  very  doubtful  whether 
he  gains  in  the  long  run.  Anyhow,  the  landless 
labourer,  who  has  no  produce  to  exchange  for  rupees, 
finds  the  market  price  in  time  of  scarcity  utterly  be- 
yond his  means.     Then  the  Government  comes  to  the 


296  ENGLAND'S  DEBT  TO  INDIA 

rescue  with  relief  works,  the  raihvays  make  roaring 
profits  —  in  fact,  famine  and  war,  both  exhausting  for 
the  country,  are  perfect  godsends  to  the  foreign  in- 
vestor —  and  the  Indian  Government  complacently 
holds  up  its  Public  Works  policy  to  an  admiring  and 
interested  English  public.  It  wholly  omits  to  mention 
that  in  time  past  nearly  £30,000,000  of  taxation  have 
been  squeezed  out  of  the  country  to  pay  interest 
charges,  and  that,  if  that  sum  had  been  left  in  the  agri- 
culturist's pockets,  he  might  himself  have  been  better 
able  to  face  bad  times,  and  have  helped  the  labourer 
to  do  the  same.  But  Sir  John  Strachey  utterly  ignores 
this  aspect  of  the  question;  he  is  quite  content  with 
pointing  to  the  relief  works,  and  then  insists  on  the 
necessity  of  constructing  more  railways  to  meet  the 
next  famine  cycle.  One  would  suppose  that  railways 
proceeded  as  a  free  gift  out  of  the  benevolent  bosoms  of 
British  capitalists,  instead  of  being  paid  for  out  of  the 
hungry  bellies  of  the  Hindoo  ryot.  The  sum  of  £30,- 
000,000  represents  the  amount  which  India  has  had 
to  pay  out  of  taxation  to  get  its  railways  built,  and 
then  it  has  paid  £15,000,000  (part  of  which  went  to 
the  railway  shareholders)  to  keep  the  people  alive,  and 
after  all  has  lost  about  five  millions  of  human  beings." 

This  was  written  in  1883.  Since  then  the  evil  has 
grown  enormously  out  of  proportion  to  the  so  called 
advantages.  For  fuller  information  and  discussion  of 
the  subject  we  may  refer  the  reader  to  Mr.  A.  K. 
Connell's  book,  to  Mr.  A.  J.  Wilson's  "  An  Empire  in 
Pawn,"  to  Mr.  Digby's  "  Prosperous  British  India,"  to 
the  statements  made  by  Messrs.  Naoroji,  Wacha, 
Gokhale  and  others  before  the  Royal  Commissioners 
on  Indian  Expenditure  in  1896,  and  to  the  evidence 
given  before  the  Famine  Commissioners  of  1880  and 
1897-98.  We  have  no  space  left  to  discuss  the  policy 
underlying  railway  rates  and  railway  fares  in  India. 


RAILWAYS  AND  IRRIGATION         297 

The  Indian  Chamber  of  Commerce  and  the  British 
Indian  Association  of  Calcutta  both  have  voiced  the 
feelings  of  the  Indian  community  as  to  the  unfairness 
of  the  discrimination  that  is  made  in  favour  of  for- 
eign trade,  to  the  neglect  and  cost  of  inland  trade  and 
Indian  industries. 

Benefits  of  Capital  Investment.  There  remains  one 
more  point  to  be  noticed.  It  is  often  said  that  the 
foreign  capital  invested  in  Indian  railways  must  have 
benefited  the  country  a  great  deal  by  affording  "  in- 
creased profitable  occupation  to  the  people  of  the 
country."  The  statement  was  examined  by  Mr.  Con- 
nell  (page  31  of  his  book,  1883)  and  his  reply  was: 

"  The  truth  about  the  capital  expenditure  is  as  fol- 
lows :  Of  the  Guaranteed  Railways  capital  of  £96,- 
794,226,  spent  up  to  the  end  of  1880-81,  £46,918,177 
were  withdrawn  in  England  and  £49,876,049  in  India, 
while  the  charge  for  interest,  amounting,  as  shown 
above,  to  about  £28,000,000,  was  almost  entirely  re- 
mitted to  England.  Thus  of  the  sum  total  of  capital 
required  for  the  construction  of  these  railways  only 
£21,000,000  were  actually  spent  in  India,  and  as  the 
sum  remitted  by  the  railway  companies  themselves  up 
to  1881  reached  the  amount  of  over  £29,000,000,  there 
was  no  balance  at  all  remaining  in  the  country.  In- 
deed, there  was  a  deficit  on  the  whole  transaction  of 
£8,000,000.  So  far,  then,  from  this  investment  of  for- 
eign capital  leading  to  an  '  outlay  of  a  larger  sum 
than  the  interest  sent  away,'  it  actually  led  to  the 
outlay  of  a  smaller  sum  than  would  have  been  spent 
in  the  country  if  no  guaranteed  railways  had  ever  been 
built. 

"  Of  the  £32,000,000  odd  raised  for  State  railways, 
twenty-four  millions  have  been  appropriated  in  India, 
and  seven  and  a  half  millions  in  England,  while  the 


298  ENGLAND'S  DEBT  TO  INDIA 

charge  for  interest,  between  two  and  three  millions  to 
be  added  to  the  capital  account,  has  also  gone  to  Eng- 
land." 

Irrigation.  The  total  outlay  on  irrigation  works  up 
to  the  end  of  the  year  1914-15  was  as  follows: 

Productive  major  works £33,780,252 

Protective  major  works 4,364,073 

Minor  works  4,525,445 

Total £42,669,770 

The  total  area  irrigated  was  ....     25,600,000  acres. 

The  net  receipts  on  capital  outlay  for  the  three 
classes  of  irrigation  works  were :  —  8.97 ;  0.59,  and 
4.52  per  cent,  respectively.  Of  the  permanent  debt 
£41,122,020  was  on  account  of  irrigation  out  of  a  total 
debt  for  public  works  (railways  and  irrigation)  of 
£275,245,288  on  the  last  day  of  March,  1915.^  It 
must  be  freely  acknowledged  that  the  twentieth  cen- 
tury has  seen  a  very  wise  change  in  the  policy  of  the 
Government  of  India  in  the  matter  of  irrigation  works 
to  bring  large  tracts  of  waste  lands  under  cultivation. 
The  way  in  which  this  last  is  being  done  is  open  to 
several  objections  but  the  work  itself  is  highly  com- 
mendable and  beneficent. 

3  The  latest  facts  and  figures  are  taken  from  the  "  Material 
and  Moral  Progress  "  report  for  1914-15,  issued  under  orders 
of  Parliament. 


CHAPTER  XII 

EDUCATION   AND  LITERACY 

Early  Conditions.  It  is  a  mere  truism  that  educa- 
tion and  literacy  are  not  the  same  thing.  One  may 
be  well-educated  without  being  literate,  and  vice  versa. 
Old  Hindu  India  was  universally  educated  as  well  as 
literate.  During  Moslem  domination,  India  was  only 
partly  educated  and  partly  literate.  In  this  connec- 
tion the  reader  should  remember  the  remarks  of 
Elphinstone  and  others  about  education  in  pre-British 
days  quoted  in  the  chapter  dealing  with  agriculture. 
Education  and  literacy  in  mediaeval  India  were  in  no 
way  less  than  the  same  in  mediaeval  Europe.  To- 
wards the  end  of  the  eighteenth  century,  India  had  as 
much  education  and  literacy  as  Europe.  The  nine- 
teenth century,  however,  has  brought  almost  a  com- 
plete revolution.  It  is  an  age  of  universal  literacy. 
Under  modern  conditions,  literacy  is  the  necessary 
road  to  economic  efficiency,  and  that  is  denied  to  India. 
If  education  makes  a  man  gentle,  kind,  God-fearing, 
considerate,  temperate  and  sober,  India  has  enough  of 
it.  Even  her  masses  have  sufficient  background  of 
character  and  intelligence.  They  are  quick  to  under- 
stand and  ready  to  assimilate.  But  this  is  an  era  of 
scientific  knowledge.  For  that,  literacy  and  formal 
instruction  are  necessary  steps.     In  that  India  is  lag- 

299 


300  ENGLAND'S  DEBT  TO  INDIA 

ging  behind  other  nations.  The  Government  has 
made  no  provision  for  the  instruction  of  the  masses. 
Eighty-two  of  every  hundred  boys  of  school  age, 
and  ninety-five  of  every  hundred  girls,  receive  no 
instruction.  Education  in  India  is  neither  universal, 
nor  compulsory,  nor  free.  The  kind  of  education 
provided  for  in  Indian  schools  is  in  its  nature  anti- 
quated; it  does  not  fit  its  recipients  for  the  battle 
of  life,  according  to  modem  conditions.  The  expendi- 
ture on  education  is  trifling  when  compared  with  other 
countries.  The  neglect  of  every  kind  of  vocational 
training  is  most  palpable.  There  is  no  provision  for 
training  skilled  labour,  nor  any  worth  the  name  for 
teaching  modern  languages  and  modern  commerce. 
The  following  facts  taken  from  the  last  quinquennial 
report  of  the  Government  of  India,  published  in  1912, 
speak  for  themselves. 

Facts  and  Figures  about  Education 

Total  population  of  India   315,156,386 

Population  of  British  India  244,267,542 

School  enrolment  for  1912 6,781,000 

The  population  of  India  of  school  age  has  been 
calculated  as  15  per  cent,  of  the  total.  The  actual 
time  spent  under  primary  instruction  is  three  to  eight 
years.  This  period,  however,  cannot  be  taken  as  suf- 
ficient to  obtain  permanent  results.  The  primary 
course  ordinarily  occupies  from  five  to  six  years ;  the 
average  age  of  school  life  is  from  the  completion  of 
the  fifth  to  the  end  of  the  eleventh  or  twelfth  year. 
These  ages  include  13.7  per  cent,  of  the  population, 
if  we  reckon  to  the  end  of  the  eleventh  year,  and  just 
below   16  per  cent,  if  we  reckon  to  the  end  of  the 


EDUCATION  AND  LITERACY  301 

twelfth  year.  On  the  assumption  of  15  per  cent,  of 
the  population  being  counted  as  of  school  age,  only 
17.7  per  cent,  of  that  number  are  now  at  school  (i.e., 
at  the  end  of  1912.) 

Total  expenditure  on  education  in  1912  ^5,239,507 

Amount  expended  on  education  from  public  funds 

just  one-half  the  total £2,700,000 

The  average  cost  of  education  of  a  pupil  in  India 
is  twelve  shillings  and  ten  pence,  or  about  $3.10;  of 
this  amount,  the  share  defrayed  by  the  Government 
from  public  funds  is  a  little  more  than  one-half,  or 
six  shillings  and  eight  pence, —  $1.60. 

Number  of  universities  in  India  in  1912  ....  5 
Two  have  been  added  since  that  time,  making 

a  total  of  7 

Number  of  colleges  affiliated  to  the  universities  179 

From  1907  to  1912  there  was  an  increase  of  3 

Number  of  students  in  colleges   36,533 

1  Expenditure  on  university  education  (p.  43)  £90,000 

One  hundred  and  twenty-three  of  the  hundred  and 
seventy-nine  colleges  in  India  are  those  in  which  purely 
arts  courses  are  given ;  the  number  of  students  regis- 
tered for  arts  courses,  28,196.  The  number  has  risen 
by  10,000  in  the  quinquennium. 

Law.  There  are  twenty-five  law  colleges  where 
courses  in  law  and  jurisprudence  may  be  pursued. 
The  number  of  students  registered  was  3,046. 

Medicine.  Of  medical  colleges  there  are  five,  with 
a  total  enrolment  of  1,822  students. 

1  The  total  expenditure  on  colleges  for  general  liberal  edu- 
cation is  given  as  4,726,000  Rs.  or  about  $1,600,000  (p.  61). 
This  includes  income  from  fees  and  private  benefactors. 


302  ENGLAND'S  DEBT  TO  INDIA 

Engineering.  Engineering  is  taught  in  four  col- 
leges and  three  schools,  with  a  few  miscellaneous 
classes  given  in  private  and  other  institutions. 
Madras  has  one  college  of  engineering,  with  provision 
for  an  elementary  study  of  the  subject  in  three  techni- 
cal schools.  Bombay  boasts  of  one  college  and  three 
small  aided  engineering  classes.  In  Bengal  there  are 
one  college  and  two  technical  schools.  The  United 
Provinces  have  one  engineering  college  among  them. 
In  the  Punjab  there  are  one  school  and  one  class  held 
in  a  private  college.  Burma  has  one  school  where 
engineering  is  taught.  The  number  of  pupils  availing 
themselves  of  these  courses  is  not  shown  in  the  Gov- 
ernment report  on  technical  institutions,  but  the  fol- 
lowing figures  were  obtained  from  the  tables  given  in 
the  second  volume : 

Total    number   of   students   in   Governmental    Schools 

and  Colleges  of  Engineering   1,607 

Total  cost  to  Government  of  enrolled  students  in  Engineer- 
ing Rs.  799,388  or  $267,000. 

Agriculture.  There  are  three  government  institu- 
tions where  agriculture  is  taught,  with  a  total  enrol- 
ment of  267  students.  Cost  to  Governinent:  Rs.  170,- 
353,  or  $56,784.  These  figures,  taken  from  page 
258,  table  139  of  the  report,  do  not  tally  with  those 
given  in  vol.  i,  ch.  i,  dealing  with  the  subject  of 
agriculture.  It  would  appear  from  this  account  that 
there  are  seven  agricultural  colleges  in  India: 

I.  At  Pusa,  opened  in  1908  as  a  post-graduate  school. 
Nineteen  pupils  were  registered,  but  by  1912  their 
number  fell  off  to  seven.  Short  courses  were  given 
in   such   subjects   as   management  of   cattle,   poultry, 


EDUCATION  AND  LITERACY  303 

fruit-growing,  lac  and  silk  production.  From  1908  to 
19 1 2  students  enrolled  in  special  courses  were  2;  45; 
59 ;  33  respectively. 

II.  Poona  College,  in  1908  made  a  separate  institu- 
tion; in  1912,  104  students  were  enrolled,  of  whom  15 
took  short  courses. 

III.  Coimbatore  College,  opened  1909;  students  en- 
rolled in  191 2,  50. 

IV.  Behar  and  Orissa  College  opened  1910;  in  191 1- 
12  students  numbered  18. 

V.  Cawnpore  College  and  Research  Laboratories; 
projected  1907-8,  formal  opening  191 1,  with  enrol- 
ment of  122. 

VI.  Nagpur  College,  with  58  students ;  time  of  open- 
ing not  stated. 

VII.  Lyalpore  College,  opened  1909;  in  191 2  en- 
rolled 49  students. 

In  addition  to  these  there  are  four  veterinary  col- 
leges and  one  school,  with  a  total  attendance  of  458 
students. 

Technical  and  Industrial  Education,  There  are 
three  classes  of  technical  and  industrial  educational 
schools:  I.  Technological  institutions  for  instruction 
in  principles  of  science  as  applied  to  industrial  arts, 
with  the  intention  of  producing  masters  and  managers 
of  industry,  and  scientific  advisors ; 

2.  Technical  intermediate  schools  for  the  training 
of  foremen  and  others  who  require  some  knowledge 
of  scientific  principles  and  machinery; 

3.  Trade  or  craft  schools  intended  to  train  artisans 
to  follow  their  calling  with  dexterity  and  intelligence. 

"In  1907,"  we  are  told  (page  176),  "there  were  no 
institutions  of  class  I  in  India,  though  education  of  an 
advanced  type  was  given  in  mechanical  and  electrical 
engineering  at  the  professional  colleges.     In  place  of 


304  ENGLAND'S  DEBT  TO  INDIA 

such  institutions,  scholarships  tenable  abroad  were  of- 
fered Indian  students,  that  they  might  benefit  by  the 
facilities  available  in  England  and  elsewhere.  The 
scholarships  were  first  started  in  1908  and  have  been 
given  on  an  average  of  about  nine  a  year"  (that  is  to 
say,  three  for  every  100,000,000  people.)  [Italics  are 
ours.] 

During  the  quinquennium,  an  institute  was  opened  at 
Bangalore,  Mysore,  for  which  a  sum  of  more  than  a 
million  dollars  was  donated  by  a  private  individual, 
the  late  Mr.  J.  N.  Tata  of  Bombay.  It  took  the 
Government  about  ten  years  to  formulate  its  policy 
in  connection  with  the  gift.  Eventually,  in  191 1,  the 
institute  was  opened.  Seventeen  students  entered, 
and,  in  the  language  of  the  report,  "  it  is  too  early  to 
judge  the  results."  Besides  the  endowment  fund,  the 
Tata  family  have  given  land  in  Bombay  which  yields 
an  annual  income  of  Rs.  125,000  or  about  $41,666; 
the  native  State  of  Mysore  has  contributed  a  sum  of 
Rs.  500,000,  or  $166,666;  the  Government  of  India 
contributed  one-half  that  amount  towards  the  initial 
expenses,  and  adds  the  magnificent  sum  of  $29,000  a 
year  towards  upkeep  and  expenses.  The  institution, 
which  originally  owed  its  existence  to  private  munifi- 
cence, is  hampered  on  every  side  by  government  inter- 
ference and  restrictions.  Public  opinion  holds  that 
the  teaching  is  incompetent,  and  that  no  education 
worthy  the  name  is  being  imparted. 

In  1911-12  there  were  altogether  two  hundred  and 
forty-two  technical  and  industrial  schools  of  the  sec- 
ond and  third  class,  out  of  which  but  twenty-five  are 
maintained  by  the  Government.  At  the  close  of  1912, 
there  were  12,064  pupils  in  these  schools,  out  of  which 


EDUCATION  AND  LITERACY  305 

number  only  1,365  were  in  government  schools ;  the 
latter  are  very  poor  institutions,  from  the  point  of 
view  of  both  teaching  and  equipment.  In  the  year  just 
cited,  the  total  amount  of  money  spent  on  the  upkeep 
and  expenses  of  these  government  schools  was  Rs. 
525,506  or  about  $175,000, —  provincial  revenues,  local 
and  city  funds  included. 

Thus,  out  of  a  population  of  315,000,000,  only  12,- 
064  pupils  are  receiving  technical  and  industrial  train- 
ing, and  this  mostly  of  an  elementary  kind.  A  com- 
parison of  government  expenditure  for  technical  edu- 
cation, in  India  and  in  America,  would  be  an  interest- 
ing study  in  extremes. 

Commercial  Schools.  At  the  close  of  1912,  there 
were  twenty-eight  commercial  schools,  with  1,543  stu- 
dents enrolled.  Six  of  these  schools  are  maintained 
by  the  Government.  The  total  expenditure  for  the 
year  was  Rs.  28,888,  or  less  than  $10,000,  provincial 
and  local  funds  included. 

Art  Schools.  Of  these  there  are  four  throughout 
the  length  and  breadth  of  India,  with  a  total  enrol- 
ment of  1,234,  or  about  four  art  students  in  a  million. 
The  total  expenditure  incurred  by  the  Government 
for  this  branch  of  education  is  Rs.  164,049,  or  $54,683. 

Education  of  Europeans.  The  Europeans  in  India, 
British  and  native  States  included,  number  about  301,- 
433.  The  report  shows  that  of  these  36,000  are  at 
school ;  it  adds  that  practically  all  those  of  an  age  to 
receive  education  are  getting  it.  The  cost  of  educat- 
ing these  36,000  children  is  Rs.  6,524,645  annually, 
out  of  which  sum  Rs.  2,124,554  are  derived  from  pub- 
lic revenues.     The  compiler  of  the  report  points  out 


3o6  ENGLAND'S  DEBT  TO  INDIA 

with  care  that  the  annual  tuition  fee  for  a  pupil  in  an 
European  institution  averages  Rs.  38,  while  for  a  pupil 
in  an  institution  for  Indians  it  averages  Rs.  2.  Let  it 
be  remembered,  as  the  report  itself  points  out,  "  that 
the  majority  of  European  pupils  are  educated  in  sec- 
ondary schools,"  while  the  majority  of  Indian  pupils 
are  educated,  when  at  all,  in  elementary  schools ;  thus 
the  comparison  loses  all  its  force.  The  average  cost 
of  education  for  an  Indian  pupil  is  estimated  at  $3.00 
a  year  (Rs.  9-4-1 1-);  the  average  cost  of  educa- 
tion for  a  European  student  is  Rs.  181,  or  $60.00  a 
year.  Towards  the  expense  of  the  Indian's  education, 
the  Government  contributes  $1.50  a  year,  while  its 
expenditure  for  the  European  student  is  $20.00  a  year. 
This  vast  difference  in  favour  of  the  European  student 
is  specially  significant  when  viewed  in  the  light  of  the 
fact  that  the  bulk  of  the  revenues  spent  on  all  educa- 
tion in  India  comes,  of  course,  from  the  pockets  of  the 
tax-paying  natives. 

'Education  of  Girls.  There  are  only  952,911  girls 
at  school  in  the  whole  country,  which  constitutes  5.1 
per  cent,  of  the  girls  of  school  age.  The  follow- 
ing figures  are  taken  from  page  215  of  the  quinquen- 
nial report: 


Colleges 

High 
Schools 

Middle 
English 
Schools 

Middle 
Vernacular 
Schools 

Institutic 

Pupils  . 

Primary 

12.866 

ms  ...     12 
173 

Schools 

with  446,225  pupil 
mber  institutions 
imber  pupils   

15,269 
s. 

193 
15,033 

168 
13,804 

13,394 

Total  nt 

. . . .    490,504 

It  is  said  that  these  latter  figures  represent  only 
"  those  in  schools  especially  established  for  girls." 


EDUCATION  AND  LITERACY  307 

The  average  cost  of  educating  an  Indian  girl  is 
Rs.  4.6  per  annum,  i.e.,  slightly  less  than  $1.50.  The 
cost  to  public  funds  is  about  half  of  that  amount, 
Rs.  2.5  per  annum. 

The  total  amount  spent  for  the  education  of  girls  is 
Rs.  6,075,045  or  a  little  more  than  $2,000,000.  Less 
than  half  is  defrayed  from  public  funds. 


CHAPTER  XIII 

CERTAIN   FALLACIES  ABOUT  THE   "  PROSPERITY  OF 
INDIA  "   EXAMINED 

There  are  certain  outstanding  fallacies  about  the 
"  prosperity  of  India,"  which  form  the  stock  in  trade 
of  British  imperialists  in  all  discussions  relating  to 
India.     We  will  examine  them  briefly. 

(a)  The  first  and  foremost  of  them  is  the  argu- 
ment that  is  based  on  the  absorption  of  precious 
metals  by  India  during  the  last  seventy  years.  In  a 
paper  bearing  the  date  August,  191 1,  in  the  collection 
of  the  East  India  Association  papers,  it  is  said  that 
within  the  seventy  years  preceding,  India  absorbed 
gold  of  the  value  of  £240,000,000,  out  of  which  no 
less  than  £82,000,000  worth  was  imported  in  the  first 
decade  of  the  twentieth  century,  leaving  a  balance  of 
£158,000,000  for  the  preceding  sixty  years. 

Taking  the  figures  from  the  statistical  abstracts  of 
1901-02  to  1910-11,  the  total  of  net  imports  of  gold 
comes  to  a  little  over  £75,000,000  only. 

The  writer  of  the  East  India  paper  also  gives  the 
figures  of  silver  imports.  He  says  that  within  the 
seventy  years  India  absorbed  2,250,000,000  ounces  of 
silver,  out  of  which  720,000,000  ounces  were  imported 
in  the  decade  immediately  preceding,  valuing  it  at 
£88,000,000. 

308 


CERTAIN  FALLACIES  EXAMINED       309 

To  the  quantity  of  gold  thus  imported  he  adds 
another  £35,000,000  as  Ukely  to  have  been  in  India 
in  1840  and  this  brings  the  grand  total  to  £275,000,000 
for  the  total  stock  of  gold  in  India  in  191 1.  Simi- 
larly he  values  the  total  stock  of  silver  in  India,  at  the 
end  of  1910,  as  worth  £250,000,000.  On  the  basis  of 
these  figures  he  remarks,  "  with  such  figures  before 
them,  how  can  people  say  that  India  is  being  drained 
of  her  material  wealth  ?  " 

Mr.  Digby's  masterly  reply  to  this  argument  is  con- 
tained in  Chapter  V  of  his  monumental  work.  We 
can  only  notice  the  argument  very  briefly. 

First  as  regards  the  total  value  of  gold  and  silver 
imported  into  India,  Mr.  Digby's  figures  for  the  sixty- 
five  years  from  1835  to  1900  come  to  £377,853,857. 
From  this  figure  Mr.  Digby  deducts  the  following: 

The    British    Indian    Mints    coined   in    sixty-five 

years  from  silver  supplied  by  Government  . .     £34,570,665 
The  Feudatory  States  have  minted,  say 13,000,000 


Total    £47,570,665 
To  this  must  be  added,  to  replace  wear  and  tear, 
estimated  before  a  Committee  of  the  House 
of  Commons  at  £666,666  a  year £43,333,290 

as  also  £65,000,000  on  account  of  wastage  in  the 
trinkets  and  ornaments  of  the  population  at  the  rate 
of  one  penny  per  head  per  annum.  This  account 
gives  a  balance  of  £221,949,902  to  the  credit  of  the 
people  of  India  in  sixty-five  years.  Dividing  the  bal- 
ance on  the  average  population  of  180,000,000  during 
the  period,  Mr.  Digby  concludes  that  in  the  sixty-five 
years  concerned,  the  treasure  imported  into  India 
would  amount  to  £1  4s.  i^d.  per  head  or  to  4>^d.  per 
head  per  annum. 


310  ENGLAND'S  DEBT  TO  INDIA 

Taking  the  figures  of  the  writer  of  the  East  India 
paper,  the  total  value  of  the  imports  of  gold  and  silver 
into  India  in  ten  years  from  1900  to  1910  would  be 
£170,000,000  or  say  an  average  of  £70,000,000  per  an- 
num. Divided  on  315,000,000  it  results  in  about  4s. 
5d.  per  head  per  annum  (no  cents).  This  average  is 
struck  without  making  any  deductions  for  coinage,  for 
government  reserves  and  for  "  the  hoards "  of  the 
feudatory  States. 

In  the  statement  of  moral  and  material  progress  of 
India  for  1911-12  "the  total  importation  of  gold 
sovereigns  for  the  decade  "  is  given  as  £57,000,000,  out 
of  which  about  £18,000,000  were  imported  in  1911-12 
alone.  Of  this,  nine  millions  were  held  in  government 
treasuries,  and  forty-eight  millions  were  either  in  cir- 
culation or  held  by  the  people. 

The  total  net  addition  to  the  silver  currency  during 
the  decade  was  about  sixty-eight  crores  of  rupees 
valued  at  £45,300,000.  This  sum  includes  only  rupees 
and  half  rupees. 

On  March  31,  1912,  the  Government  reserve  con- 
sisted of 

Gold £21,259,400 

Silver  Coin £10,328,100 

Bullion    ,. . .   £        52,500 

It  would  be  thus  seen  that  after  proper  deductions 
the  net  treasure  really  absorbed  by  the  people  and 
princes  of  India  considerably  dwindles. 

At  this  stage  it  would  be  well  to  remember  that  the 
native  States  of  India  take  a  great  deal  of  precious 
metals   in   return   for   the  goods   which  they   supply. 


CERTAIN  FALLACIES  EXAMINED       311 

Their  import  of  merchandise  per  head  is  considerably 
less  than  in  British  India  and  they  get  the  price  of 
their  exports  mostly  in  bullion. 

The  fact  is  that  when  making  pleas  like  this  the 
British  Imperialists  forget  the  huge  population  with 
which  they  are  dealing  and  fail  to  make  the  necessary 
deductions.  Besides,  they  ignore  that  India  is  a  heavy 
borrower.  Debts  raised  in  England  must  be  sent  to 
India  in  the  shape  of  gold  and  silver. 

No  one  contends  that  there  are  no  rich  people  in 
India.  Some  of  the  rulers  of  the  native  States  may 
have  amassed  big  treasures.  Besides,  the  Govern- 
ment contractor,  the  banker,  the  lawyer  and  the  stock 
exchange  dealer  have  all  made  some  money.  In  every 
country,  however  poor  generally,  there  must  be  a  cer- 
tain section  of  the  population  who  are  rich.  Their 
existence,  though,  does  not  prove  that  the  people  are 
prosperous.  The  fact  remains  that  in  spite  of  these 
imports  of  gold  and  silver  the  average  income  of  an 
Indian  has  been  officially  estimated  to  be  not  more 
than  $10  a  year  ^  and  the  average  wealth  per  capita  in 
India  is  £11.  We  have  given  the  comparative  tables 
in  another  chapter. 

(b)  The  trade  figures  are  also  cited  as  proof  of 
India's  prosperity.  We  have  already  shown  who 
profits  by  this  trade.  If  we  divide  the  total  foreign 
trade  on  315  millions  of  Indians  it  comes  to  much  less 
than  £1  per  head. 

(c)  The  same  may  be  said  about  the  figures  relat- 
ing to  railways.     See  the  chapter  on  railways. 

1  At  which  figure  it  has  stood  for  the  last  thirty  years  (see 
Appendix). 


312  ENGLAND'S  DEBT  TO  INDIA 

As  to  the  poverty  of  the  masses  and  the  general  lack 
of  money  in  India,  we  may  in  conclusion  quote  from 
an  article  by  Sir  D.  Hamilton  in  the  July,  1916,  num- 
ber of  the  Calcutta  Review. 

Says  Sir  D.  Hamilton: 

"  We  have  given  India  peace ;  but  we  have  not  given 
her  power  —  the  power  to  rise  in  the  human  scale. 
India  is  four-fifths  of  the  Empire  but  has  not  one-fifth 
of  her  strength  .  .  ,  Weak  in  education,  weak  in  med- 
icine, weak  in  sanitation,  weak  in  political  power,  and 
weak  in  all  that  is  due  to  weakness  in  finance  more 
than  anything  else." 

Again : 

"  Money  is  power,  and  modern  money  is  Credit,  of 
which  India  has  little  or  none ;  and  a  people  without 
Credit  are  a  people  without  a  present  or  a  future." 

"  How  is  it,"  asks  he,  "  that  in  the  year  of  our  Lord 
1916,  after  a  hundred  years  of  British  rule  and  under 
a  Government  the  most  humane  in  the  world,  India 
is  so  bare  of  Credit  and  Cash."  His  answer  is : 
"  Mainly  because  the  Government  has  overlooked  the 
first  principles  of  political  economy.  .  .  .  The  first  ob- 
ject of  its  political  economy  has  been  to  square  its  own 
budget  rather  than  to  enable  the  people  to  square  theirs. 
It  has  enabled  the  people  to  provide  a  plentiful  revenue 
not  for  themselves  but  for  others." 

"  The  national  purse  is  empty  for  peace  as  for  war 
and  will  remain  empty  until  the  purses  of  the  people 
are  first  filled  in  accordance  with  the  first  principles 
of  political  economy." 

"  Russia  understands  this." 

Sir  D.  Hamilton  then  makes  some  quotations  from  a 
recent  speech  of  the  Russian  Finance  Minister  and 
finally  winds  up  this  part  of  his  paper  by  remarking, 


CERTAIN  FALLACIES  EXAMINED       313 

"  While  Russia  plans  and  prospers,  is  India  '  to  wait 
and  see '?  " 

In  another  part  of  the  same  paper  he  observes, 
"  Financially  the  people  stand  where  they  did  at  the 
commencement  of  British  rule." 

The  Indian  Nationalists,  however,  think  that  the 
people  are  financially  worse  ofif  than  they  were  at  the 
commencement  of  British  rule. 

How  the  recent  "  gift "  of  $500,000,000  by  the  Gov- 
ernment of  India  to  the  Imperial  Government  will 
affect  the  financial  resources  of  India  remains  to  be 
seen. 


CHAPTER  XIV 

TAXES   AND  EXPENDITURE 

Abstract  of  Revenue  and  Expenditure.  The  pre- 
ceding chapters  of  the  book  give  some  idea  of  the 
principal  sources  of  government  revenue  and  also  what 
proportion  of  them  is  spent  in  England. 

In  this  chapter  I  propose,  for  facility  of  reference 
and  comparison,  to  give  a  summary  of  government 
revenue  and  expenditure.  The  statistical  abstract 
available  to  me  is  that  of  1913-14,  and  I  take  my 
figures  from  it. 

Gross  Revenue  for  1913-14  £85,207,175 

Expenditure  charged  to  Revenue  in  India 62,583,079 

Expenditure  charged  to  Revenue  in  England 20,311,673 

Surplus    2,312,423 

Principal  Heads  of  Revenue 

Land  Revenue  £21,391,575 

Opium 1,624,878 

Salt   3,445,305 

Stamps   5,318,293 

Excise 8,894,300 

Customs  7,558,220 

Assessed  Taxes 1,950,250 

Forest  2,229,872 

Registration    518,962 

Tributes  from  Native  States  616,881 

Provincial   Rates    180,210 

Total  ....     £53,728,746 

Net  receipts   from  Railways   £17,625,634 

Irrigation    4,7I3,I59 

Military  Receipts  1,369,652 

314 


TAXES  AND  EXPENDITURE  315 

Interest    £1,352,119 

Post    Office    2,410,210 

Telegraph    ;  1,188,309 

Mint   339,841 

Receipts  by  Civil  Departments  such  as  Courts  of 

Law,  Jails,  &c 1,408,286 

Miscellaneous   Receipts    772,579 


Total  Revenue  . .  £85,207, 175 

Expenditure 

Charges  in  respect  of  Collections,  Refunds,  Draw- 
backs, Assignments  and  Compensation £9,274,597 

Interest  on  ordinary  Debts  and  ordinary  obliga- 
tions      1,515,653 

Post  Office  2,092,019 

Telegraph    ,...  1,180,965 

Mint    132,630 

Salaries  and  Expenses  if  Civil  Departments  ...  I7,934ii99 

Miscellaneous  Civil  Charges   5,403,804 

Famine   Relief  and  Insurance    1,000,000 

Railway  Revenue  Account  including  interest  on 

debt  12,836,101 

Irrigation    3,531,867 

Other  Public  Works  7,010,038 

Military  Services  21,265,765 


Total  Expenditures   £83,177,688 

Deducting  two  minor  sums  about  provincial  allot- 
ments not  spent  the  total  expenditure  charge- 
able to  Revenue  i  emains   £82,894,752 

Expenditure  not  charged  to  Revenue  for  Rail- 
ways, Irrigation  works  and  the  construction 
of  new  Delhi  12,212,596 


Total  Charges   £95,107,348 

Ingenious  Way  of  Calculating  the  Burden  of  Taxa- 
tion.    In    the    statistical    abstract    a    very    ingenious 
method  is  adopted  to  show  the  burden  of  taxation, 
(a)  The  heads  of  Taxation  are  reduced  to  Salt, 
Stamps,  Excise,  Provincial  Rates,  Customs, 
Assessed  Taxes  and  Registration.     All  other 


3i6  ENGLAND'S  DEBT  TO  INDIA 

sources  of  income  are  omitted.  The  figure 
realised  from  these  sources  is  thus  reduced 
from  over  85  millions  to  27,278,680.  This 
figure  divided  over  the  estimated  population 
of  British  India  brings  the  payment  per  head 
to  2  shillings  and  2-4  pence. 

It  is  however  added  that  "  if  Land  Revenue  [which 
is  not  properly  taxation]  be  added  the  payment  per 
head  comes  to  3  shillings  and  10-4  pence." 

It  may  be  noted  that  receipts  from  opium,  courts 
of  justice,  jails,  railways,  post  office,  telegraphs,  canals, 
forests  and  public  works  are  all  excluded,  omitting 
other  minor  heads  of  income. 

The  Growth  of  Army  Expenditure.  In  1884-85 
the  total  army  expenditure  was  170  million  rupees, 
i.e.,  a  little  less  than  57  million  dollars. 

In  1899-1900  it  was  264  millions  of  rupees  =:  88 
million  dollars. 

In  1909-1910  it  rose  to  286  millions  of  rupees  = 
95^^  million  dollars.^ 

In  1914-15  it  was  about  306.5  millions  of  rupees  = 
over  102  million  dollars  (£20,434,915). 

In  the  budget  of  1916-17  22  million  pounds  or  330 
millions  of  rupees  or  no  millions  of  dollars  were  pro- 
vided for. 

As  to  the  percentages  of  military  expenditures  to 
the  total  budgets  of  the  diflferent  parts  of  the  British 
Empire,  see  an  article  in  The  Nineteenth  Century  and 
After  for  February,  1917,  by  Yusaf  Ali  from  which 
extracts  are  given  in  appendix  (A). 

1  Figures  are  taken  from  the  Honourable  Mr.  D.  E.  Wacha's 
pamphlet  on  "  Indian  Military  Expenditure."  This  year's 
budget  exceeds  26  millions  sterling. 


TAXES  AND  EXPENDITURE  317 

The  army  alone  absorbs  the  total  revenue  from  land 
andmore. 

The  Grozvth  of  Expenditure  on  Education.  To  a 
total  of  £6,696,587  spent  on  education  from  all  sources 
including  fees  and  private  munificence  in  191 3-14,  the 
provincial  funds  contributed  £2,436,900  (see  the  sta- 
tistical abstract). 

According  to  the  Year  Book  (191 5)  issued  by  The 
Times  of  India  Office,  Bombay,  the  Government  of 
India  spent  on  education  2,610,000  in  1912-13.  In 
the  year  191 3-14  they  made  a  provision  of  4,078,000 
in  the  original  budget,  but  in  the  revised  one  the  figure 
was  reduced  to  3,242,000.  In  the  budget  for  19 14-15 
a  provision  of  4,000,000  was  made,  but  in  the  finan- 
cial statement  made  by  the  finance-member  in  March, 
19 1 6,  it  was  explained  that  the  total  sanctioned  was 
not  spent  and  in  the  estimate  presented  by  him  for 
the  next  year  the  figure  available  for  education  was 
actually  reduced. 

It  was  my  intention  to  show  how  much  of  the  ex- 
penditure on  the  civil  departments  consisted  of  sala- 
ries paid  to  Europeans  in  India,  but  the  latest  figures 
available  to  me  are  those  given  in  the  Material  and 
Moral  Progress  Statement  for  1911-12  and  they  are  not 
complete.  It  is  stated  in  that  report  that  out  of  the 
aggregate  salaries  of  officers  drawing  twenty-five  dol- 
lars a  month  (£5)  or  over 

Europeans  received R.  3,590,000 

Eurasians  "       844,000 

Indians  " .       2,457,000 

Of  posts  carrying  salaries  of  R.  1000  a  month 
(3333^  dollars  or  £66%)  1721  were  held  by  Europeans 


3i8  ENGLAND'S  DEBT  TO  INDIA 

and  i6i  by  Indians.  For  a  comparison  of  the  salaries 
enjoyed  by  Europeans  in  the  service  of  the  Govern- 
ment of  India  with  corresponding  officers  in  the  United 
States,  see  appendix. 


CHAPTER  XV 

SUMMARY  AND   CONCLUSION 

The  British  conquest  of  India  has  no  parallel  in 
history.  It  is  the  most  romantic  and  the  most  subtle 
of  all  political  revolutions  that  have  taken  place  in  the 
world.  It  was  never  formally  planned;  it  was  never 
authoritatively  resolved  upon.  Yet,  paradoxical  as  it 
may  seem,  we  cannot  believe  it  was  the  blind  accident 
that  Professor  Seeley  characterises  it.  In  the  preface 
to  the  second  volume  of  Sir  William  Hunter's  "  His- 
tory of  British  India,"  the  editor  has  said: 

"As  early  as  1687  the  Court  of  Directors  hoped  to 
lay  the  foundations  of  a  large,  well-founded,  sure 
English  dominion  in  India  for  all  time  to  come." 

He  inclines  to  think  the  British  aimed  at  a  commer- 
cial rather  than  a  political  supremacy,  but  the  history 
of  British  acquisition  in  India  conclusively  proves  that 
successful  commercial  ascendency  is  but  the  sure  and 
inevitable  prelude  to  political  domination. 

Of  all  forms  of  conquest,  that  which  proceeds  under 
the  guise  of  comiherce  is  most  msidious,  most  pro- 
longed^ and  most  devastatmg  to  the  conquered.  A 
military  invasion,  undertaken  from  frankly  ^olitfcal 
motives,  at  least  does  not  take  the  peopleunawai'es. 
The  waf^of  olden  times  were  short  and  swift,  and 
their  results  certain.     A  change  of  despotisms  mat- 

319 


') 


320  ENGLAND'S  DEBT  TO  INDIA 

tered  little  to  the  people  of  East  or  West ;  in  the  long 
run,  they  adapted  themselves  to  the  change.  The 
swift  horrors  of  warfare,  with  its  decisiveness  of  ac- 
tion and  certainty  of  outcome,  are  inconceivably  pref- 
erable to  The  sTo w  torYufes  6TX"imIitary~mvasion  thaf" 
comes  cloaked  under  the  guise  of  commercial  enter*. 
pris"er"  Had  the  British  Government,  in  17^7,  invaded 
India  by  force  of  arms  and  subjugated  the  country  on 
the^"open  field  of  battle,  a  century  of  incessant  warfare, 
no  less  agonising  because  of  its  protracted  nature, 
mlghrHav¥  been  spared  her.  But  behind  military  and 
commercial  exptoitatioiT'slcuIked  the  Tust  for  political 
dominidri.  Most  of  the  rriisTorliIiTes~ef"  India,''^om 
1757  to  1857,  are  due  to  the  manner  in  which  she  was 
/  subjugated.  ^*To'"fHe  victor  T)elong  the  spoils  *'  is~a 
universal  law  of  warfare,  but  martial  law  cannot  last 
forever,  and  a  more  stable  government  under  politi- 
cians and  statesmen  inevitably  reasserts  itself.  But 
who  is  to  call  a  halt  on  the  plundering  of  commercial 
adventurers?  Where  is  the  limit  to  their  greed  and 
rapacity  ? 

In^^a^  was  never  conquered  by  the  English  sword  — 
not  by  military  valour,  but  by  a  subtle  and  cunning 
diplomacy.  To  have  used  more  direct  means,  Msed 
upon  an  avowed  determination  to  subdue  the  country 
by  force  of  arms,  would  have  roused  the  warring 
chiefs  to  a  sense  of  mutual  danger,  and  united  them 
against  the  common  enemy.  When  Clive,  in  1765,  of- 
fered to  conquer  Hindustan  for  Great  Britain,  Pitt 
refused,  saying  it  was  beyond  the  resources  of  the 
government.  The  conquest  of  India  was  accom- 
plished in  the  only  way  England  could  afford  to  do  it^ 


SUMMARY  AND  CONCLUSION         321 

at  India's  expfip&e.  Lulled  by  professions  of  a  purely 
commercial  interest,  the  native  chieftains  vied  with 
one  another  in  extending  opportunities  of  trade  to  the 
British,  in  return  for  military  services  rendered  by 
these  armed  merchants  in  subduing  local  rivals.  Too 
late  they  found  that  the  mailed  fist  which  encompassed 
the  ruin  of  their  enemies  was  turned  with  equal  ef- 
fectiveness against  themselves ! 

The  English  policy  was  simply  ^"^  rnngigtpnf  —  \n^ 
create  schisms  in  the  camps  of  the  Nabobs  and  Rajahs, 
ustfig'one  side  agamst  the  other,  for  the  furtheraynce'of 
their  l)wntntere5tr"C6urd'fRFTSrabob  of  Bengal  have 
seen  the  finger  of  fate  in  the  concessions  to  build  forts 
and  factories  on  his  eastern  coast,  which  he  granted  to 
the  East  Indian  traders ;  could  the  Vizier  of  Oude  have 
foreseen  that  the  power  whose  help  he  invoked  to  ruin 
Benares  and  extirpate  the  Rohillas  would  in  less  than 
a  century  pension  off  his  descendants  as  helpless  para- 
sites on  its  mercy  and  magnanimity ;  could  the  Grand 
Mogul  have  realised  the  significance  of  his  grant  of 
Dewani  to  Clive ;  had  the  Nabob  of  Karnatic  had  pro- 
phetic eyes  to  read  the  future  ruin  of  his  house,.when 
he  obtained  aid  from  the  English  to  overcome  the  Mah- 
rattas ;  if  the  Nabob  of  Surat  and  the  Rajah  of  Tan- 
jore  might  have  read  their  twin  fates  in  the  stars  — 
this  petty  warfare  would  have  coalesced  into  a  united 
stand  against  this  alien  foe,  and  cast  him  out  of  India. 
But  what  Indian  prince  could  doubt  the  treaties  of 
""eternal  friendship  "  sworn  to  by  these  British  trad- 
ers,—  or  their  solemn  abjurations  of  all  thoughts  of 
territorial  aggrandisement?  A  house  divided  against 
itself  cannot  stand,  and  betrayed  by  their  own  rivalry. 


322  ENGLAND'S  DEBT  JO  INDIA 

they  sold  their  countr)-  to  a  foreign  power,  whose 
servants,  urged  on  by  private  greed  and  patriotic  zeal, 
bought  their  undisputed  sway  over  a  contihenfi 

PhiHp  Francis,  in  an  epigrammatic  speech  delivered 
on  Indian  affairs  in  1787,  describes  the  process  thus: 

"  From  factories  to  forts,  from  forts  to  fortifica- 
tions, from  fortifications  to  garrisons,  from  garrisons 
to  armies,  and  from  armies  to  conquests,  the  grada- 
tions were  natural,  and  the  results  inevitable ;  where 
we  could  not  find  a  danger  we  were  determined  to  find 
a  quarrel." 

The  directors  of  the  East  India  Company  wanted 
money.  That  was  the  burden  of  their  communica- 
tions to  Warren  Hastings  and  his  successors  in  the 
Presidency  of  Bengal.  But  their  agents  in  India  also 
wanted  money  for  themselves.  It  was  well  said  by 
one  of  them  that  when  "  more  money  could  not  be  had 
by  legitimate  means,  they  took  to  the  road."  Trade, 
external  and  internal,  afforded  too  restricted  and  slow 
accumulations  of  wealth ;  political  intrigues,  backed  up 
by  military  force,  could  alone  secure  desired  results. 
The  examples  of  Clive,  Governor  Vansittart,  and 
Warren  Hastings  offered  too  strong  an  inducement  of 
success  to  be  resisted  by  men  of  human  passions  and 
human  weaknesses  undeterred  by  any  check  upon  their 
fears.  Governors  and  members  of  council,  not  to 
mention  generals  and  commanders,  all  had  their  fixed 
share  in  the  booty  which  every  military  exploit 
brought.  In  addition  to  the  ordinary  loot,  secured  in 
the  sacking  of  towns  after  military  conquests,  every 
treaty  entered  into  with  a  native  prince  was  ratified 


SUMMARY  AND  CONCLUSION         323 

by  large  grants  of  money  made  by  the  latter  "  to  the 
officers  concerned  in  settling  the  treaty."  ^ 

Every  interest,  private  and  public,  personal  and 
patriotic,  drove  the  representatives  of  the  East  India 
Company  to  seek  opportunities  of  exploitation  through 
military  operations  and  political  intrigues.  Most  of 
the  proceeds  of  prize  money,  booty  and  presents  were 
appropriated  by  the  company's  servants,  the  charges 
of  administration  and  the  maintenance  of  the  army 
being  met  by  the  revenues  proper.  From  time  to  time, 
the  directors  reiterated  in  solemn  terms  their  freedom 
from  territorial  designs,  but  where  treaties  had  been 
made,  and  lands  acquired,  they  quietly  confirmed  the 
former  and  accepted  the  latter,  often  conferring  signal 
honours  on  those  instrumental  in  securing  them. 

India'sJtnisiortunes  .w£re-thus  enhanred  by  the  vacil- 
lating  policies  of  the  merchant  masters  of  the  com- 
"pahy,^  whom  CIiatTiam  once  cfescribedTas  "  th^  lofty 
Asiatic  plunderers  of  Leadenhall  Street." 

The  traders  of  Leadenhall  were  not  conquerors. 
They  did  not  care  for  an  empire.  What  they  wanted 
was  money,  and  they  were  quite  happy  when  tlie~mili- 
tary^anBTpoITtical  opeTatiDTTTXff  their" s^enrants" brought 
them  substantial  gains.     But  when  the  reverse  was  the 

1  One  such  item  is  £300,000  mentioned  by  Malcolm  in  con- 
nection with  the  treaty  which  was  made  with  Tipu.  Another 
by  Torrens :  "  when  the  prize  money  came  to  be  decided  upon, 
after  the  campaign  of  1799,  £100,000  which,  according  to  rule 
would  have  fallen  to  the  share  of  the  Governor  General, 
Marquis  of  Wellesley,  the  latter  waived  in  favour  of  the 
troops."  (Malcolm,  Vol.  I,  Ch.  5,  note, —  Torrens,  "Empire 
in  Asia,"  pp.  230,  248.)  Another  mention  of  prize-money  in 
connection  vvith  Lord  Wellesley  is  made  in  reference  to  the 
war  with  Scindhia. 


324  ENGLAND'S  DEBT  TO  INDIA 

case,  they  were  equally   ready  to  condemn  and   re- 
pudiate.^ 

Between  these  conflicting  policies,  the  Indian  people 
wefe  ground  into  the  dust.  Ihe  security  of  the  native 
rulers  was  practically  gone  from  the  moment  Warren 
Hastings  confiscated  the  territories  of  the  Rajah  of 
Benares  and  assisted  the  Vizier  of  Oude  to  extermi- 
nate the  Rohillas.  Thus  their  own  chiefs  could  not 
protect  them  from  new  ones  whose  wars  of  exploita- 
tion soon  developed  into  wars  of  annexation.  It  was 
the  Marquis  of  Wellesley  who  first  saw  the  monstrosity 
of  the  dual  system,  and  who  determined  by  hook  or 
crook  to  put  an  end  to  native~rule.  With  the  totaf 
lack  of  scruple  characterising  most  empire  builderi^ 
he~pursued  a  policy  of  deception,  telling  delibefate lies 
in  his  public  despatches,  while  availing  himself  of 
every  pretence  to  make  wars  and  snatch  territories.^ 

Justice,  honest;^,2'iaIf  pTay7  and  tlie^^^  w  of  the 

2  Sheridan  described  their  attitude  when  he  said  that  "there 
was  something  in  their  operations  which  combined  the  mean- 
ness of  a  pedlar  with  the  profligacy  of  a  pirate.  Alike  in 
military  and  political  manoeuvres  could  be  observed  auctioneer- 
ing ambassadors  and  political  traders,  and  thus  we  saw  a 
revolution  brought  about  by  affidavits,  an  army  employed  in 
executing  an  arrest,  a  town  besieged  on  a  note  of  hand,  a 
prince  dethroned  for  a  balance  of  account.  Thus  it  was  tliey 
united  the  mock-majesty  of  a  bloody  sceptre  and  the  little 
traffic  of  a  merchant's  counting  house,  wielding  a  truncheon 
with  one  hand,  and  picking  a  pocket  with  the  other."  (Speech, 
Feb.  7,  1787,  Pari.  Hist.,  Vol.  XXV,  Col.  287.) 

3  The  Rajah  of  Benares  lost  his  territory  for  refusing  to 
make  an  exorbitant  contribution  towards  defraying  the  ex- 
penses of  the  Company's  wars  in  the  South,  for  which  he 
recognised  no  obligation.  The  Rohillas  were  extirpated  be- 
cause the  Nabob  of  Oude  required  it  in  compensation  for 
large  sums  he  was  forced  to  pay  to  the  English. 

Torrens,  p.  221,  for  quotations  of  Marquis  of  Wellesley's 
despatches.  Vol.  I,  and  certain  correspondence  between  the 
Governor  General  and  Mr.  Dundas. 


SUMMARY  AND  CONCLUSION        325 

people  never  entered  into  the  programme  of- Wellesley 
and' his  lieutenants,  who  entered  wholeheartedly:  iato 
l^s__sche.mfiS..__Jhe  only  criterion  was  the  chance  of 
success  for  theiF  enterprises.     Arguing  agairisTTmme^ 
diate  further  conquest,  the  Marquis  wrote  to  Munro : 

"  I  agree  with  you  that  we  ought  to  settle  the  Mah- 
ratta  business  and  the  Malabar  Rajahs,  but  I  am 
afraid  that  to  extend  ourselves  will  rather  tend  to 
delay  settlement  .  .  .  as,,jjgjijh£jvish^af^  the  people, 
I  piitthem  out  of  the  question."  *    The  italics  are  ours. 

Munro  was  for  out  and  out  conquest,  though  he 
cautiously  added,  "  we  should  not  all  at  once  attempt 
to  extend  ourselves  so  far,  for  it  is  beyond  our  power, 
but  we  should  keep  the  object  in  view,  though  the  ac- 
complishment might  require  a  long  series  of  years. 
The  dissensions  and  revolutions  of  the  native  govern- 
ments will  point  out  the  time  when  it  is  proper  for  us 
to  become  actors."  ^ 

Thus  spoke  the  company's  representatives  in  India, 
the  while  they  openly  opposed  territorial  expansion 
and  signed  treaties  sworn  to  endure  till  the  sun  and 
moon  failed  in  their  course.  Native  dissensions  and 
revolutions  not  coming  with  sufficient  speed,  the  serv- 
ants of  the  company  used  every  available  means  to 
hasten  them,  for  the  furtherance  of  their  designs. 
Alliances  were  made,  and  broken ;  subsidies  were  de- 
manded and  exacted,  and  residents  placed  in  native 
courts  to  sow  the  seeds  of  internal  dissension  and  do- 
mestic revolution.     Says  Torrens: 

"  Lord  Wellesley's  purpose  in  persuading  the  Native 

4  Gleig's  "  Life  of  Munro,"  Vol.  I,  p.  266. 

5  Ibid.,  Vol.  I,  p.  123. 


326  ENGLAND'S  DEBT  TO  INDIA 

Governments  to  maintain  within  their  confines  bodies 
of  English  troops,  instead  of  Native  corps  officered  by 
Frenchmen,  was  too  obvious  to  be  misconceived.  .  .  . 
It  was  obviously  meant  and  felt,  if  not  declared,  to  be  a 
guarantee  against  the  development  of  schemes  hostile 
to  English  interests  and  the  growth  of  English  ascend- 
ency, ...  It  was  the  glove  of  mail  courteously  but 
undisguisedly  laid  upon  the  shoulder  of  Native  rule, 
with  an  irresistible  but  patronising  air,  felt  to  be  a 
little  heavy  and  hard  at  first,  but  soon  destined  to  be- 
come habitual. 

"  Its  financial  scope  was  conceived  and  executed 
with  the  same  pitiless  and  inexorable  purpose.  The 
permanent  appropriation  of  revenue  for  the  mainten- 
ance of  the  subsidiary  force  was  calculated  mainly 
with  the  inability  of  the  State  to  bear  it.  .  .  .  The 
opening  of  a  running  account  of  deficiencies,  arrears, 
balance  cleared  off  from  time  to  time  by  new  conces- 
sions, became  inevitable.  Arriving  at  ultimate  suprem- 
acy, the  means  taken  were  called  by  the  subject  race, 
perfidiously  wicked, —  by  the  conquering  race,  pro- 
foundly wise."  ^ 

Besides  bodies  of  English  troops  stationed  at  native 
courts,  there  were  the  active  efforts  of  the  Residents, 
"  everywhere  feared  and  hated  as  the  symbol  of  humil- 
iation," employed  in  corrupting  ministries,  spying  on 
chiefs,  and  seeking  provocation  to  disrupt  and  disor- 
ganise the  government  in  which  they  played  the  role 
of  dictator.'' 

Glimpses  of  these  Machiavellian  policies  may  be 
found  in  the  contemporary  records  of  the  great  actors 

<>  Torrens,  "  Empire  in  Asia,"  pp.  233-34-35, 

^  See  Garwood,  Wellesley  Correspondence;  also  "Papers 
and  Correspondence  of  Lord  Metcalfe,"  regarding  the  policy 
of  Sir  Thomas  Barlow ;  also  the  Private  Journal  of  Lord 
Moira,  Vol.  I,  p.  44,  quoted  in  Torrens,  Chapter  XIX, 


SUMMARY  AND  CONCLUSION         327 

themselves,  a  glance  at  which  will  amply  repay  the 
reader  who  desires  first  hand  knowledge.  Enough  has 
hqen  said  to  illustrate  the  point  taken,  that  the  British 
subjugation  of  India  was  a  long  process  of  miUtary 
and  economic  exhaustion,  a  sort  of  killing  by  inches, 
which  took  a  century  to  complete.  ]\|any  a  noble- 
minded  Englishman  tried,_as  best  he  could,  to  alleviate 
the  sufferings  of  the  peo£le^of_Iiidia.  Some  of  these 
attempted  to  persuade  their  masters  at  home  to  adopt 
a  more  humane  policy  towards  the  country  which  they 
were  exploiting  to  its  ultimate  ruin.  But  they  failed. 
There  were  periods  of  comparative  peaceT  when  some 
constructive  upbuilding  was  attempted,  Ibut  ~oh  the 
whole,  the  century  was  one  of  destruction  and  ex- 
ploitation.  People  died  by  milHons ;  the  country  was 
drained  of  wealth;  fields  were  devastated  and  m.anu- 
factures  ruined;  the  seal  of  poverty,  hopeless,  unrmfi- 
gated,  unredeemed,  was  set  upon  the  land  once 
fabled  for  its  riches. 

Lord  Dalhousie,  so  lauded  by  English  historians  for 
his  high-minded  justice,  may  be  regarded  most  char- 
itably as  the  unintentional  and  involuntary  instrument 
of  Providence  which  brought  India's  long  agony  of 
civil  strife  and  bloodshed  to  a  close.  His  unjustifiable 
and  piratical  acts  exasperated  both  people  and  princes, 
and  drove  them  to  open  rebellion.  The  British  were 
now  determined  to  make  an  empire  from  East  to 
West,  and  as  early  as  18 16  had  decided  to  "  annihilate 
all  powerful  native  Governments."  ^  So  the  criminal 
breaches  of  trust  and  acts  of  high-handedness  in  re- 
gard to  the  Punjab,  Oude,  Jhansi,  Nagpur,  Satara  and 

8  Metcalfe,  in  "  Kaye's  Life,"  p.  432. 


328  ENGLAND'S  DEBT  TO  INDIA 

Scinde  but  hastened  the  annexation  which  at  best 
could  only  have  been  deferred  a  few  years  longer. 
Up  to  1858,  India  was  British  by  courtesy  only.  After 
the  mutiny,  the  British  Government  took  over  the  di- 
rect administration  of  its  affairs.  Queen  Victoria 
started  the  new  regime  auspiciously  with  a  proclama- 
tion guaranteeing  equal  treatment  of  natives  and  Eng- 
lish,—  promises  so  far  honoured  more  in  the  breach 
than  in  fulfilment.  The  reason  is  obvious.  Under 
the  Crown,  as  under  the  Company,  there  is  the  same 
clash  of  interests  between  Indian  democracy  and  Brit- 
ish plutocracy  —  under  the  new  system,  as  under  the 
old,  England  still  battens  on  India's  wealth,  which  is 
drained  off  in  a  golden  stream,  bearing  her  life  blood 
with  it.  During  the  last  fifty-seven  years,  the  fiscal 
policy  in  regard  to  the  Great  Dependency  was  laid 
down  in  Whitehall,  and  no  English  Cabinet  dared  to 
sacrifice  the  interests  of  the  British  merchant  class  for 
a  mere  consideration  of  Indian  well-being. 

As  the  prosperity  of  Britain  is  grounded  on  manu- 
factures and  trade,  British  interests  demand  that  In- 
^^ia  live,  toil  and  have  her  being  to  the  end  ot  British 
A    prosperity,  by"~sending  grist  to  the  mill  and  buying  the 


tflouf^  "HeFslsTtre  doubler^lFo^  supplying  the  raw  ma- 
terial anS  purchasing  the  finished  product.  A  self- 
gnvprnin^_Jjldi-^  wnnid  npvpr  submit  JO  play  ffirs""part, 
hence  she  remains  a  dependency  under  pressure. 

A  distinguished  Indian  economist  said  recently: 
"India's  misfortunes  ar€  due  to  the  fact  that  she  is 
economically  passive  j  what  she  needs  is  to  be  econom- 
ically active." 

■^tr  ,\/lJt  is  futile  for  Indians  or  j^nglish_t^  talkof^  Indiaj 


SUMMARY  AND  CONCLUSION         329 

economic  developmpnt  nnfi'l  glip  I'g  free  tn  lay  down  her 
own  fiscal  policy  in  [-"^r  own  int'"r?f^tg  cXhis  can  never 
be  until  the  Indian  Government  is  so  transformed  as 
VTfhake  it  responsible,  not  to  the  India  Otiice  m  Lon- 
doiT,"l)Ut  to  the  people  of  India  themselves.^  JThe  pres- 
ei^tT^dministration  has  neglected  everything__upon 
which  her  prosperity  as  a  nati.on„cauld.-be-built.  There 
is  virtually  no  provision  there  for  producing  skilled 
labour  "oFliHe  higher  order7~educatr6n,~  both  general 
and  technical,  is  shockingly  neglected.  In  all  the 
length  and  breadth  o(  India,  there  is  but  one  technolog- 
ical institute,  and  this  owes  its  existence  to  private 
munificence.  Even  now  its  usefulness  in  promoting 
the  development  of  Indian  industries  is  virtually  nil, 
so  hedged  about  with  restrictions  is  its  management. 

The  principal  industry  of  India  is  agriculture,  yet 
before  1907  there  was  not  a_sm^le  agricujjhj^^  col- 
lege in  the  whole  cpunlry.  A  privately-endowed  com- 
mercial college  has  been  opened  recently  in  Bombay, 
but  even  this  institution  rests  under  the  suspicion  of 
being  a  reserve  for  third-class  men  from  England. 

For  a  number  of  years,  Indians  have  been  crying  for 
a  definite  Government  policy  towards  native  industries. 
This  agitation  reached  its  climax  during  the  present 
war.  The  successful  entry  of  Japan  as  a  competitor 
has  forced  the  hand  of  the  Administration,  and  a  com- 
mission has  been  appointed  to  inquire  and  report  upon 
the  industrial  situation.  The  questions  of  tarifif  and 
fiscal  policy  are  declared  to  be  outside  its  scope,  and 
already  the  independent  Indian  mind  suspects  the  ap- 
pointment of  this  body  a  mere  sop  to  public  opinion. 
The  Hon.   D.   E.  Wacha,   Member  of  the  Supreme 


330  ENGLAND'S  DEBT  TO  INDIA 

Legislative  Council,  a  recognised  authority  on  Indian 
finance,  declared  he  had  no  reason  to  think  this  Com- 
mission likely  to  be  different  from  others  of  which  we 
have  had  such  bitter  experience  in  the  past.  "  In  the 
long  run,"  he  says,  "  their  recommendations  are  akin 
to  a  change  from  Tweedledum  to  Tweedledee." 

The  economic  situation  of  India  to-day  was  very 
tersely  summed  up  by  the  able  young  publicist,  the 
Hon.  C.  Y.  Chintamani,  in  his  address  to  the  Provincial 
Conference  at  Jhansi,  Oct.  8,  1916: 

"  The  mass  of  the  population  is  poor,  very  poor.  A 
state  of  destitution,  accompanied  by  disease  and  debt, 
is  the  normal  condition  of  the  bulk  of  the  people.  A 
comparative  study  of  the  aggregate  annual  national 
income,  expenditure  and  savings  of  the  peoples  of  dif- 
ferent countries,  would  reveal  a  painful  state  of  things 
in  India.  John  Bright  said  that  if  a  country  possess- 
ing a  most  fertile  soil  and  capable  of  bearing  every 
variety  of  production,  found  the  people  in  an  extreme 
state  of  suffering  and  destitution,  there  was  some 
fundamental  error  in  the  government.  The  observa- 
tion was  made  of  India.  The  Duke  of  Argyll,  Secre- 
tary of  State  for  India  under  Gladstone,  recorded  his 
opinion,  '  of  chronic  poverty  and  permanent  reduction 
to  the  lowest  level  of  subsistence  such  as  prevail  among 
the  vast  population  of  rural  India,  we  have  no  example 
in  the  Western  world.'  In  a  paper  on  the  wealth  of 
the  Empire,  read  before  the  British  Association  in 
1903,  the  aggregate  annual  income  of  the  United  King- 
dom (whose  population  is  less  than  our  United  Prov- 
inces) was  put  at  1,750,000,000  pounds  and  that  of 
India  at  600,000,000  pounds,  roughly,  30  rupees  per 
head  per  annum.  The  general  survey  of  the  Empire 
led  Sir  Robert  Giffen  to  consider  *  how  vast  must  be 
the  economic  gulf  separating  the  people  of  the  United 
Kingdom  from  India  when  we  find  that  42,000,000  of 


SUMMARY  AND  CONCLUSION        331 

people  in  the  United  Kingdom  consume  in  food  and 
drink  alone  an  amount  equal  to  the  whole  income 
of  300,000,000  Indians.  Unless  relieved  from  their 
state  of  semi-starvation,  the  Indian  problem  and  diffi- 
culty remain  untouched.'  He  further  pointed  out  the 
anomaly  of  Britain  requiring  of  India  and  India  alone, 
a  substantial  military  expenditure,  though  the  wealth 
of  the  self-governing  colonies  is  so  enormously  greater 
than  that  of  India.  This  though  the  Indian  army  is 
freely  used  for  imperial  and  general  purposes,  and  is 
not  employed  exclusively  for  local  defence. 

"  Agriculture  is  our  one  national  industry,  but  it  is 
in  a  depressed  state.  We  are  told  that  the  increased 
cultivation  of  exportable  crops  such  as  jute,  cotton 
and  oil  seeds,  and  the  higher  level  of  prices  have 
brought  greater  prosperity  to  India  —  but  all  things 
considered,  their  state  is  hardly  better  than  before,  and 
the  oft-recurring  famines,  each  one  meaning,  besides 
intense  suffering,  enormous  loss  of  wealth ;  the  grow- 
ing pressure  of  the  revenue  demand ;  and  the  higher 
cost  of  living  have  made  their  condition  worse.  The 
output  per  acre  is  smaller  in  India  than  elsewhere,  be- 
cause the  cultivator  cannot  afford  to  adopt  costlier 
methods.  The  magnitude  of  agricultural  indebtedness 
is  appalling,  nor  is  it  due  to  the  extravagance  of  the 
ryots.  The  land  revenue  system  has  an  intimate  bear- 
ing on  the  condition  of  the  agricultural  population,  and 
Mr.  J.  E.  O'Connor  recommended  a  general  reduc- 
tion of  33  per  cent,  in  the  Government  demand,  a  plea 
as  ineffectual  as  the  repeated  resolutions  of  the  Indian 
National  Congress  and  the  efforts  of  Mr.  R.  C.  Dutt 
have  been. 

"  Manufacturing  industries  are  a  second  source  of 
national  wealth.  India  was  not  a  stranger  to  them  in 
the  past,  but  what  was  euphemistically  described  as 
'  the  tide  of  circumstance  '  deprived  her  of  them.  Mr. 
Justice  Ranade's  impressive  description  of  our  indus- 
trial helplessness  is  not  out  of  date:  'The  country  is 
fed,  clothed,  warmed,  washed,  lighted,  helped  and  com- 


332  ENGLAND'S  DEBT  TO  INDIA 

forted  generally  by  a  thousand  arts  and  industries  in 
the  manipulation  of  which  its  sons  have  every  day  a 
decreasing  share.  This  dependency  has  come  to  be 
regarded  as  a  plantation,  growing  raw  products  to  be 
shipped  by  British  agents  in  British  ships,  to  be  worked 
into  fabrics  by  British  skill  and  capital,  and  to  be  re- 
exported to  India  by  British  merchants  to  their  British 
shops  there  and  elsewhere.  Stagnation  and  depend- 
ence, depression  and  poverty  —  these  are  written  in 
broad  characters  on  the  face  of  the  land  and  its  peo- 
ple.' The  recent  Government  efiforts  at  industrial  de- 
velopment hardly  touch  the  fringe  of  the  problem. 

"  A  third  source  of  wealth, —  foreign  trade,  does  not 
contribute  to  the  prosperity  of  Indians,  being  mainly 
in  the  hands  of  Europeans  whose  home  is  away  from 
India,  besides  the  drain  of  wealth  due  to  political 
causes." 

Indian  public  opinion  is  thus  practically  unanimous 
on  the  following  points : 

(a)  British  policy  in  India  is  responsible  for  the 

destruction  of  Indian  industries. 

(b)  The  British  Government  in  India  has  so   far 

failed  in  a  duty  which  is  recognised  by  all 
national  governments  to  revive  indigenous  in- 
dustries and  establish  new  ones. 

(c)  The  fiscal  policy  of  the  Indian  Government  has 

been  dictated  from  Whitehall  mainly  in  the 
interest  of  British  trade,  in  opposition  to,  and 
often  in  defiance  of  the  best  Anglo-Indian 
administrators. 

(d)  India  has  suffered  from  a  constant  drain  of  her 

national  wealth,  which  has  enriched  England 
to  India's  cost. 

(e)  While  free  trade  has  been  profitable  to  Eng- 

land, it  has  been  ruinous  to  India,  with  its 
doctrine  of  laissec-faire. 

(f)  Railway    construction,    by    means    of    foreign 

loans,  interest  on  which  was  guaranteed  by 


SUMMARY  AND  CONCLUSION         333 

the  Government  to  be  paid  from  Indian  reve- 
nues, has  been  ruinous  to  Indian  finance.  Up 
to  1 899- 1900  it  brought  no  return  to  the  tax- 
payer. 

(g)  The  railways  discriminate  against  Indian  in- 
dustries and  internal  trade  in  their  freight 
rates.^ 

(h)  The  governmental  neglect  of  education,  gen- 
eral, commercial  and  technical,  retards  the 
growth  of  modern  industries  in  India,  as  it  re- 
sults in  lack  of  skilled  labour. 

(i)  In  view  of  India's  impoverished  condition, 
there  can  be  no  justification  for  the  system  of 
costly  administration  in  force  for  the  past  150 
years,  as  it  is  maintained  at  the  expense  of 
native  economic,  industrial  and  educational 
development.  Far  too  much  money  has  been 
spent  on  the  military. 

(j)  India's  resources  have  been  squandered  in  mili- 
tary expeditions  in  which  she  had  no  interest. 
A  policy  of  Imperial  expansion  has  been  fol- 
lowed at  the  cost  of  India. 

*(k)  The  only  effective  remedy  for  these  crying 
evils  is  "  self-government,"  with  "  fiscal  au- 
tonomy." 

In  the  language  of  one  of  our  most  conservative 
leaders  of  public  thought,  the  Hon.  Mr.  D.  E.  Wacha, 
already  quoted  above: 

"  If  Indian  poverty  is  to  be  reasonably  reduced,  if 
the  standard  of  living  of  the  teeming  masses  is  to  be 

9  The  Chairman  of  the  Indian  Merchant's  Chamber  and 
Bureau  of  Commerce  stated  in  his  last  annual  report :  "  The 
indigenous  Industries  Committee  appointed  by  the  Bombay 
Government  found  that  over  and  above  the  difficulties  of  lack 
of  expert  advice,  and  of  adverse  raihcay  rates,  in  some  cases, 
these  industries  suffered  from  under-capitalisation."  Italics 
are  mine.  The  British  Indian  Association  of  Calcutta,  a  body 
of  Bengal  Zemindars,  have  recently  made  the  same  representa- 
tion on  railway  discrimination,  to  the  Government. 


^- 


334         ENGLAND'S  DEBT  TO  INDIA 

satisfactorily  raised;  if  education  and  sanitation  are 
to  be  greatly  accelerated,  the  first  and  fundamental 
assumption  is  a  well-devised  scheme  of  fiscal  auton- 
omy. Unless  the  people  are  allowed  full  freedom  to 
work  out  their  own  economic  destiny,  it  is  hopeless 
to  foresee  a  prosperous  India." 

Thus  we  see  that  not  only  the  left  wing  of  Indian 
Nationalists,  but  conservative  native  opinion  as  well, 
sees  in  self-government  the  only  potent  rempdy  fnr  thp 
Indian  Problem.^ 

English  opinion  on  the  subject  is  widely  divided. 
The  number  willing  to  concede  India  her  rights  is 
painfully  limited.  A  few  intellectuals  favour  the  idea, 
as  well  as  a  scattering  of  radical  thinkers,  writers  and 
Members  of  Parliament.  Those  statesmen  who  are  at 
the  helm  preserve  an  ominous  silence.  In  the  mean- 
time, the  proposal  to  make  the  colonies  partners  in  the 
Empire  has  created  consternation  in  India.  Indian 
opinion  on  the  point  was  correctly  voiced  by  the  Hon. 
C.  Y.  Chintamani  when  he  remarked :  — 

"  Brother-delegates,  the  war  has  brought  the  supreme 
question  of  India's  political  status  to  the  front.  What 
is  to  be  her  future  position  in  the  Empire,  and  what 
the  system  of  internal  government  ?  The  fervid  utter- 
ances of  British  statesmen,  the  even  warmer  utterances 
of  politicians  and  the  British  press,  during  the  early 
months  of  the  war,  must  be  still  fresh  in  your  minds. 
England  went  to  war  for  the  practical  assertion  of  the 
rights  of  nations  to  freedom,  and  India  was  not  to  be 
denied.  The  British  Empire,  of  which  India  com- 
prises the  largest  single  whole,  was  to  be  a  really  free 
empire.  India  was  not  for  long  to  remain  a  mere 
dejicndency, —  she  was  to  be  recognised  as  a  partner. 
Im;)erialism  was  no  longer  to  stand  for  the  aggran- 
disement of  the  white  peoples  at  the  expense  of  the 


SUMMARY  AND  CONCLUSION         335 

coloured  races,  so-termed.  Indians  were  no  longer  to 
be  mere  subjects  of  exploitation  for  the  benefit  of  His 
Majesty's  colourless  subjects.  Even  the  colonists  of 
the  self-governing  dominions  seemed  to  be  thinking 
kindly  of  us.  We  have  always  asserted  our  indefeasi- 
ble right  to  absolute  equality  of  status,  and  these  first 
signs  of  recognition  gave  us  fresh  hope  to  claim  what 
we  have  always  been  entitled  to  as  our  just  right,  and 
not  a  favour.  The  Prime  Minister  and  other  eminent 
British  statesmen  have  made  repeated  public  declara- 
tions that  the  constitution  of  the  Empire  will  undergo 
a  change  upon  the  war's  termination.  But  in  the 
whole  of  the  discussions  very  little  reference  to  India 
is  found.  The  Secretary  of  State,  our  *  Grand  Mogul 
at  Westminster,'  has  had  scarcely  a  cheering  word  to 
utter.  He  has  found  time  to  put  through  Parliament 
two  such  uncalled-for  and  retrograde  measures  as  the 
Indian  Civil  Service  Act  and  the  Government  of  India 
Act  —  the  Prime  Minister  has  spared  parliamentary 
time  for  their  passage  through  both  houses ;  but  the 
annual  debate  on  Indian  affairs  has  been  suspended 
during  the  last  three  years,  and  there  has  been  no  au- 
thoritative statement  on  the  policy  of  His  Majesty's 
Government  in  relation  to  India.  In  India  itself,  the 
'  new  angle  of  vision  '  has  manifested  itself  in  the  form 
of  internments  and  prohibitions  under  the  *  Defence 
of  India '  Act ;  a  too  free  employment  of  the  arbitrary 
*  Press  Act,'  with  controversial  legislation,  increased 
police  expenditure  (particularly  the  C.  I.  D.  branch) 
and  a  reduced  outlay  on  education. 

"  But  a  far  worse  menace  confronts  us.  It  has  been 
given  out  that  the  present  self-governing  dominions 
are  to  be  admitted  into  partnership  with  England  in 
governance  of  the  Empire;  the  Crown  Colonies,  India 
among  them,  will  be  subjected  to  a  further  degrada- 
tion of  their  already  low  political  status,  subject  to  the 
politicians  of  Canada,  South  Africa,  Australia  and 
New  Zealand.  Why  should  any  one  think  of  inflict- 
ing such  a  grievous  wrong  upon  India?    What  are 


336  ENGLAND'S  DEBT  TO  INDIA 

these  colonies  of  yesterday  by  the  side  of  this  hallowed 
land  of  ours,  which  stretches  in  its  sublime  past  to  the 
beginnings  of  humanity,  with  a  culture  and  a  civili- 
sation which  will  for  all  time  shed  lustre  on  the  human 
race ;  with  qualities  of  heart  and  head  in  respect  to 
which  her  children  need  fear  no  comparison  with  any 
people  in  any  country ;  and  looking  forward  with  con- 
fidence, to  a  future  not  unworthy  of  her  ancient  past? 
Why  should  they  be  our  rulers, —  why  should  we  sufifer 
them  to  be?  We  mean  to  insist  with  greater  deter- 
mination that  there  shall  be  no  governing  caste  in  In- 
dia,—  no  rulers  and  ruled,  but  equal  subjects  with 
common  rights  and  obligations,  living  on  terms  of 
manly  comradeship.  How  galling  to  contemplate 
subjection  to  the  colonies  whose  superior  title  in  any 
respect  we  see  no  reason  to  acknowledge.  It  is  our  im- 
perative duty  to  make  it  known  to  all  concerned  that 
India's  position  in  the  Empire  shall,  in  all  respects,  be 
identical  with  that  of  the  present  self-governing  do- 
minions. To  compromise  is  to  commit  political  sui- 
cide as  a  nation  and  a  race."  ^° 

English  opinion  on  the  economic  effects  of  British 
rule  in  India  may  be  divided  into  three  classes : 

First :  Men  such  as  Hyndman,  Digby,  Martin,  Wil- 
so.i  and  others,  who  frankly  admit  the  economic  harm 
done  to  India  by  British  rule,  and  express  their  regret 
therefor. 

Second:  Men  who  do  not  admit  the  economic  ex- 
ploitation of  India  by  England,  but  maintain  that  Eng- 
land's management  has  made  India  more  prosperous 
than  ever  before  in  her  history.  To  this  class  be- 
long men  of  the  Strachey  school. 

Third:     Men  who  honestly  admit  the  fact  of  In- 

1"  Since  the  above  was  in  type  a  reassuring  statement  on 
the  subject  has  been  made  by  the  Secretary  of  State  for  India. 


SUMMARY  AND  CONCLUSION         337 

dia's  exploitation  for  England's  profit,  but  who  justify 
it  by  the  right  of  conquest.  They  maintain,  and 
rightly,  that  India  was  acquired  for  the  purpose  of 
commercial  gain,  and  should  be  administered  on  that 
basis.  This  is  the  Morning  Post  school,  and  thor- 
oughly to  be  commended  for  the  absence  of  hypocrisy, 
which  governs  the  utterances  of  diplomats  and  polit- 
ical apologists.  Grandiloquent  bursts  of  rhetoric  are 
inconsistent  with  British  bluntness  and  do  no  credit 
to  her  national  candour.  If  Englishmen  have  ex- 
ploited  India,  it  can  be  justified  on  the  only  tenable 
ground  of  India's  having  allowed  herself  to  be  so  ex- 
ploited? One  nation  does  not  conquer  another  out  of 
philanthropy,  and  at  its  best,  the  rule  ot  one  peo^e 
over  another  can  5"e  bilt  "  benevolent  despotism." 
Dofmhation  is  always  dictated  by  self-interest,  justified 
by~the~right  of  mijJflU.  The  crime  of  India  ..was_her 
weakness,  and  she  expiates  it  under  the  heel  of  Im- 
n^erialTsnTr^I-^tJier  ffow  strong  or  perish  —  the  woHcl 
gives  no  place  to  senility. 

Such  is  the  creed  of  the  twentieth  century,  worked 
out  in  the  bloody  struggles  of  the  past,  and  in  the 
law  of  the  survival  of  the  fittest.  But  in  expounding 
the  law,  let  us  not  prate  of  ethics.  Exploitation  and 
conquest  may  have  peculiar  ethical  value  in  the  vast 
economy  of  Nature,  but  for  that,  credit  and  a  sancti- 
monious justification  is  not  given  to  the  exploiter  and 
the  conqueror.  Let  me  not  rob  a  weaker  brother,  and 
cry  "  holier  than  thou "  as  an  added  claim  to  his 
possessions.     It  profanes  the  might  of  right. 

It  lies  within  the  reader's  judgment,  based  on  the 
facts  here  stated,  to  decide  how  benevolent  is  Eng- 


338  ENGLAND'S  DEBT  TO  INDIA 

land's  despotism  in  India.  Blitish  rule  iii_Jiidia-has 
its  brighter  side.  Young  India  has  drunk  deep  from 
the  "spnngs  of  liberty  and  the  rights  of  man,  as  em- 
Bodied  in  Enghsh  history  and  literature;  it  has  im- 
bibed  the  spirit  of  modern  civiTrsatTorr,~epitomised  ni  the 
activity  and  efiefgy  of  the  West;  it  isIeTrm  fun- 

damental  law  of  nations,  "  self-pfeservatioTi  iy  the  law 
of  hfe."  From  her  own  standpoint,  England  has  not 
been  an  unmixed  blessing  to  India,  and  from  ours,  she 
has  not  proved  an  urmiHed  cui^e7  ~  Slie'Tia"s~tau  us 
the  blessings  of  the  wealth  she  has  deprived1I5'~0f:; 
she~Iias  awakened  the  need  for  the  education  she  has 
nof~g!ven ;  she~has  proven  the  value  of  the  power  she 
dares  not__b£Stow.  The  West  has  not  knocked  at  the 
door  of  the  East  without  response, —  we  are  learning 
to  answer  it  in  kind.  Patriotism,  NationaHsm,  Hu- 
man Brotherhood  and  the  Rights  of  Man  echo  around 
the  world  to-day,  but  before  these  sacred  sentiments 
become  truths  no  less  sacred,  they  must  be  won,  it 
seem^  by  right  of  might. 

England  says  that  she  had  ruled  India  to  India's 
own  best  interests,  and  that  we  should  never  have  been 
so  prosperous  or  happy  as  a  nation,  as  under  British 
rule.  Imperial  Britain  would  imply  that  Englishmen 
are  angels,  dwelling  in  an  Utopian  dream.  Where  is 
the  human  being  above  self-interest  and  greed? 
Where  is  the  man  who  will  not  wield  his  power  to 
his  own  ends?  One  may  meet  such  individuals, 
though  they  are  rare ;  but  to  seek  for  a  nation  so  dis- 
interested as  to  rule  another  in  the  best  interests  of 
the  latter,  is  futile.  It  is  time  England,  as  well  as  In- 
dia, faced  the  situation  squarely  and  accepted  it  for 


SUMMARY  AND  CONCLUSION         339 

what  it  is,  or  make  a  better  one.^^  There  has  never 
been  sincerity  in  the  relationship  of  foreign  ruler  and 
native  ruled.  The  farce  of  paternalistic  dominance 
must  end,  and  some  clear  adjudication  be  made  of  re- 
sgective  rights  and  obligations,  else  a  grim  trage^ 
w.illb^jeriact£d^  Under  the  existing  system,  a  thin 
stratum  of  governnienijfficlaTsT~^a\v'ihg"~prTncely  sal- 
aries,— -lawyers,  bankers,  constructors  and  stock-ex- 
change traders,— ^^ay  ignore  "the  humiliation  of  their 
position,  and  consider  themselves  benefited  by  British 
rule.  But  the  majority  of  them  are  sullen  and  discon- 
tented, feeling  themselves  for  what  they  are  —  para- 
sites, battening  on  the  vitals  of  their  motherland.  The 
masses,  whether  traders,  agriculturists  or  labourers, 
cflre  t)eing  crushed  beneatti  the  weight  of  thi5"-pttiless 
Western  Jug'gfernautr--  From  one-third  to  one-fifth  are 
insufficiently  fed,  housed  and  clothed ;  ninety  per  cent, 
are  illiterate ;  truly,  if  **  to  be  weak  is  miserable,"  their 
helplessness  makes  them  most  wretched.  The  very  ef- 
forts of  Englishmen  themselves  to  succour  them  have 
failed,  under  the  present  inexorable   regime.^^     The 

11 "  The  connection  between  England  and  India  is  a  political 
anomaly  that  has  no  parallel  in  history.  Calling  the  Indians 
'our  fellow  subjects'  is  misleading."  ("Colonies  and  De- 
pendencies," Macmillan  &  Co.,  1883.) 

12  Says  Mr.  Thorburn,  late  Financial  Commissioner  of  the 
Punjab  (p.  349):  "Looking  back  for  twenty-five  years,  re- 
membering the  causes  of  the  Afghan  War  of  1878-80,  the 
straining  of  our  relation  with  the  Amir,  1890-93,  the  subse- 
quent thrusting  of  *  friendly  relations '  and  a  protectorate 
upon  the  independent  tribes  beyond  our  frontier,  the  enforced 
delimitations  of  some  of  their  hinterlands,  the  futile  con- 
sequential wars  of  1897-98;  unprejudiced  minds  must  recog- 
nise that  the  tax-paying  masses  of  India  have  received  scant 
consideration,  and  that  some  of  the  heads  of  Government  and 
subordinate  officers  answerable  for  the  blunders  and  wastage 
of  different  periods,  should  have  been  discredited,  instead  of 


340  ENGLAND'S  DEBT  TO  INDIA 

attempt  of  Lord  Crewe  to  carry  his  India  Council  Re- 
form Bill  of  1914;  the  attempt  to  obtain  an  Executive 
Council  for  the  United  Provinces  under  the  Govern- 
ment of  Lord  Hardinge ;  the  effort  to  repeal  the  coun- 
tervailing excise  duties  on  Indian  cotton  goods,  all 
ended  in  failure,  and  demonstrate  the  hopelessness  of 
ameliorating  the  system.  There  is  but  one  panacea 
for  Indian  ills :  the  road  may  lie  rough  before  us,  the 
march  long  and  dangerous,  but  the  goal  lies  clear  ahead 
as  the  summum  honum  of  our  national  existence : 
Qlome  Rule,  Self  Government,  Autonomy.  Thjs  is  the 
end  for  which  we  must  live,  putting  our  soul's  salva- 
tion  upon  the  at'fainmentot  Liberty,  the  spiritual~lTer- 
ifage'"oFman.  Woe  to  us  if  we  fail!  Eternal  glory 
i f "we  succeed! 

rewarded.  So  long  as  the  Government  of  India  is  practically 
an  irresponsible  despotism,  and  the  Indian  public  merely  a 
powerless  mass  of  uninformed  and  inarticulate  taxpayers,  mud- 
dling misrepresentation  and  waste  in  the  conduct  of  Indian 
foreign  affairs  will  not  cease,  and  high-placed  blunderers  in 
authority  will  never  be  called  to  account.  Until  some  force  in 
India  arises  with  the  power,  the  will  and  ability  necessary  for 
securing  a  commonsensc  management  of  affairs,  business-like 
prudence  will  not  always  be  practised. 

"  Present  methods  suit  a  bureaucracy :  unless  forced  from  the 
outside,  reforms  from  inside  are  hopeless.  Without  the  cer- 
tainty that  the  truth  will  come  out,  and  be  intelligently  ex- 
amined and  judged,  no  government  will  proclaim  its  mistakes, 
or  alter  its  ways."     ("  Punjab  in  Peace  and  War,"  p.  349.) 


APPENDIX  A 

Extract  from  an  article  by  A.  Yusaf  AH,  a  retired 
Indian  Civil  Servant,  published  in  The  Nineteenth 
Century  and  After  for  February,  1917 : 

"  The  Indian  Income  Tax  brings  within  its  net  only 
332,000  persons  out  of  a  population  of  244  millions  in 
British  India,  the  exemption  limit  being  as  low  as  66 
pounds  (that  is  $330).  Only  13,000  persons  have  an 
income  of  666  pounds  ($3,330)  or  over  in  British  In- 
dia." 

The  following  remarks  are  made  in  regard  to  the 
Government  policy  of  control  of  the  price  of  wheat 
during  the  war  : 

"  Government  policy  in  the  matter  was  directed  to- 
wards two  objects:  (i)  to  divorce  India  prices, 
which  by  themselves  would  have  been  lower,  from  the 
world  prices.  (2)  To  secure  the  surplus  of  India's 
bumper  wheat  production  last  year  for  lowering  the 
prices  of  wheat  in  the  United  Kingdom.  In  191 5  the 
prices  broke  famine  records  and  went  as  high  as  six: 
seers  for  one  rupee  in  a  year  when  the  wheat  crops 
had  been  splendid  and  the  prices  would,  in  normal 
times,  have  been  very  low." 

Mr.  Yusaf  AH  gives  the  following  figures  about  the 
military  expenditure  of  the  different  parts  of  the  Brit- 
ish Empire  and  its  proportion  to  the  total  Budget  of 
Revenue : 

Military  Budget  for  ipi^-ipi4 

Millions 

of  Percentage  to  total 

Pounds  Budget  of  Revenue 

Great   Britain    28.2  14.5 

India   18  22 

Australia   2.5  10 

Canada  1. 5  5 

South  Africa   r.15  7.7 

341 


342  ENGLAND'S  DEBT  TO  INDIA 

This  is  exclusive  of  the  cost  of  the  Imperial  Service 
troops  maintained  by  the  Indian  Princes  at  their  own 
cost  and  used  by  the  British  for  Imperial  purposes. 


APPENDIX  B 

Extracts  from  an  article  by  Mr.  Manohar  Lai,  B.  A. 
(Cantab),  late  Minto  Professor  of  Economics  in  the 
University  of  Calcutta,  published  in  the  Indian  Jour- 
nal of  Economics  for  July,  1916: 

"  The  average  income  per  head  has  remained  the 
same  (that  is  $10  a  year)  during  the  last  thirty  years 
and  more.  ...  It  is  a  fact  that  deserves  careful  study 
at  the  hands  of  all  students  that  with  signs  of  grow- 
ing prosperity  everywhere,  with  an  undoubted  advance 
in  the  whole  apparatus  of  industrial  life,  the  average 
Indian  income  has  remained  stationary.  How  far  this 
fact  involves  that  a  vast  proportion  of  our  population 
can  have  taken  no  share  in  the  general  urban  rise  in 
India,  and  in  view  of  the  undeniable  fact  of  large  in- 
creases in  prices  how  far  it  probably  has  entailed  some 
depression  in  the  economic  status  of  her  masses  — 
these  are  enquiries  that  must  present  themselves  to 
every  student  of  economics  in  the  country,  and 
thoughtful  Indians  have  not  been  able  to  interpret 
their  bearing  in  a  sense  favourable  to  the  country's 
prosperity. 

"  Poverty,  grinding  poverty,  is  a  tremendous  fact  of 
our  economic,  and  therefore  national,  position,  and  it 
is  to  the  mind  of  the  present  writer  an  immeasurably 
more  potent  fact  than  even  the  ignorance  and  illiteracy 
that  prevails  among  our  masses.  This  poverty  exposes 
us  to  the  havoc  of  disease  and  pestilence,  famine  and 
plague  and  it  makes  advance  at  every  step  difficult." 

Mr.  Monohar  Lai  then  compares  the  food  budget  of 
an  English  workingman's  family,  that  of  a  railway 


APPENDICES  343 

carriage  washer  with  that  of  an  Indian  field  labourer  as 
given  by  Mr.  Keating,  an  Englishman,  in  his  very 
careful  work  on  rural  economy  in  the  Deccan  and 
observes : 

"  It  is  a  picture  of  literal  starvation  mentally,  and 
all  but  so  physically ;  it  can  represent  the  life  of  no  unit 
of  civilised  humanity." 

Further  on,  summarising  the  present  situation,  he  re- 
marks : 

"  Indian  population  grows,  her  earning  power  per 
head  is  stationary,  such  increase  in  her  industries  as 
has  taken  place  is  nothing  compared  to  the  growth  of 
her  population.  The  inference  is  irresistible;  life  in 
India  continues  on  the  lowest  plane,  untouched  by  all 
the  movements  and  progress  that  is  in  the  air." 


APPENDIX  C 

How  the  Villagers  Live  in  the  Madras  Presidency 
—  An  Article  from  the  Tribune  of  Lahore  of  January 
19,  1917. 

In  England  and  other  European  countries  the  study 
of  the  condition  of  the  working  classes  has  led  to 
their  improvement.  A  similar  study  of  the  condition 
of  the  Indian  people  is  necessary  to  devise  measures 
for  their  economic  improvement.  The  Government 
were  asked  several  times  to  hold  such  enquiries  in  vil- 
lages exposed  to  frequent  famines.  But  they  thought 
that  it  would  serve  no  useful  purpose  to  do  so.  In 
England  private  individuals  and  public  associations 
have  aroused  sympathy  for  the  working  classes  and 
Government  have  readily  adopted  necessary  reforms. 
It  would  be  useful  if  similar  work  was  undertaken 
by  individuals  and  associations  in  India.  A  good  ex- 
ample has  been  set  in  this  direction  by  Mr.  S.  P.  Patro, 
who  read  an  interesting  paper  at  the  Madras  Eco- 
nomic Association  on  the   nth  instant.     His  Excel- 


344  ENGLAND'S  DEBT  TO  INDIA 

lency  the  Governor  presided.  The  enquiries  were  held 
in  15  villages  of  the  Ganjam  District  and  the  places 
selected  were  those  in  which  the  conditions  were  alike 
as  far  as  possible.  The  people  living  in  the  villages 
were  asked  certain  questions  regarding  their  income 
and  expenditure  as  also  their  debts.  And  care  was 
taken  to  prevent  exaggerated  or  incorrect  answers  by 
verifications  of  facts  supplied  by  others.  After  going 
through  the  details  of  assessment,  population,  number 
of  agriculturists,  the  income  of  a  typical  family,  the 
food  consumed,  etc.,  Mr.  Patro  found  that  in  a  par- 
ticular village  the  budget  of  the  ryot  showed  a  deficit 
of  Rs.  22-9-0  every  year  and  it  was  not  possible  to 
obtain  a  full  meal  every  day.  Dealing  similarly  with  a 
typical  village  in  the  Chicacolo  division,  Mr.  Patro 
found  that  the  annual  income  of  a  family  of  a  typical 
zamindar,  who  had  wet  and  dry  lands,  was  Rs.  129-8-0, 
and  that  the  expenditure,  including  cost  of  rice,  oil, 
clothing,  etc.,  was  Rs.  181-8-0,  leaving  a  deficit  of  Rs. 
52  a  year.  For  marriage  and  litigation  the  head  of 
the  family  raised  a  loan  of  Rs.  380  in  1907  and  dis- 
charged the  same  in  1913  by  sale  of  rice  and  by  living 
on  inferior  corn  and  the  profits  of  rice-pounding.  The 
family  had  full  meals  only  from  January  to  the  month 
of  May  according  to  the  statement  of  the  ryot.  In 
a  zamindari  village  the  annual  income  of  a  typical 
family  was  Rs.  316  and  the  expenditure  Rs.  321-6-0 
and  there  was  a  debt  outstanding  against  the  family. 
In  another  zamindari  village,  the  income  of  a  typical 
family  was  Rs.  786  and  the  expenditure  Rs.  698-4, 
leaving  a  balance  of  Rs.  68  to  the  credit  of  the  family 
whose  aflfairs  were  conducted  in  a  most  economic  way. 
That  was  not  a  profit,  but  it  represented  the  wages 
which  the  members  of  the  family  earned  for  their 
personal  labour  on  the  land  at  Rs.  14  a  head  per  year. 
On  these  facts  Mr.  Patro  made  the  following  re- 
marks : 

"  I  tried  to  place  before  you  actual  conditions  ob- 
served in  my  investigation  into  some  of  the  villages 


APPENDICES  345 

in  the  Ganjam  district.  The  investigation  commenced 
more  than  a  year  ago,  and  I  do  not  attempt  to  discuss 
the  many  problems  to  which  the  studies  give  rise. 
Others  will  have  to  draw  conclusions  and  advocate 
remedies.  From  the  sketches  it  will  be  seen  how  the 
population  is  increasing  and  the  actual  cultivating 
owners  are  decreasing;  how  the  holdings  are  split  up, 
and  the  landless  labourers  are  growing,  how  little  im- 
provement is  made  in  agricultural  methods  and  how 
little  possibility  there  is  for  improving  agricultural 
methods  owing  to  the  growing  poverty,  physical  de- 
terioration and  indebtedness  of  the  agriculturist ;  how 
the  cultivation  of  the  present  holdings  can  never  pay 
and  the  ryots  are  sinking  lower  and  lower.  The  ra- 
tions available  for  the  agriculturist  in  some  cases  are 
poorer  than  the  diet  given  to  the  prisoners  in  jails. 
That  large  number  of  agriculturists  and  labourers  emi- 
grated to  Calcutta,  Burma,  Straits  Settlements  and 
other  places  is  a  common  factor  in  all  these  villages. 
In  the  last  named  village  about  one  hundred  out  of  a 
population  of  about  878  have  gone  out  in  search  of 
better  wages  and  to  work  in  non-agricultural  work. 
There  is  therefore  pressing  need  for  full  enquiry  into 
the  economic  conditions  of  the  agricultural  population 
in  this  Province." 

These  enquiries  are  very  interesting  and  show  the 
desirability  of  conducting  similar  enquiries  in  other 
provinces  and  districts.  Punjab  is  not  much  different 
from  Madras  in  regard  to  the  land  tenure  and  gen- 
eral conditions  of  the  agricultural  population.  We 
think  that  the  enquiries  made  by  Mr.  Patro  are  of 
particular  interest  to  us  and  the  fact  that  the  people 
are  sinking  lower  and  lower  in  poverty  is  particularly 
distressing.  That  some  of  them  receive  poorer  diet 
than  the  jail  population  is  a  statement  which  should 
suggest  the  adoption  of  urgent  remedies.  Mr.  Patro, 
it  will  be  seen,  does  not  want  Government  to  accept 
his  conclusions  but  invites  further  enquiries  of  the 
kind.    Throughout  India  educated  people  are  press- 


346  ENGLAND'S  DEBT  TO  INDIA 

ing  for  the  reform  of  land  laws  so  as  to  improve  the 
condition  of  the  masses,  and  experienced  men  have 
shown  how  deeply  the  ryots  are  sunk  in  poverty  and  in- 
debtedness. Mr.  Patro's  enquiries  go  to  confirm  these 
opinions  and  to  contradict  the  official  theory  about  the 
prosperity  of  the  peasantry.  In  the  typical  village 
homes  whose  family  budgets  were  examined  the  peo- 
ple had  an  annual  deficit  in  three  out  of  four  cases  — 
a  fact  which  cannot  but  show  the  pitiable  condition  of 
the  agriculturists.  His  Excellency  the  Governor  ex- 
pressed his  appreciation  of  the  enquiries  made  by 
Mr.  Patro  and  admitted  that  the  facts  ascertained 
must  be  fairly  accurate,  though  no  general  conclusion 
could  be  drawn  from  them  alone. 


APPENDIX  D 

WAGES  IN   INDIA 

The  reports  and  publications  of  the  Government  of 
India  do  not  give  sufficient  data  to  enable  one  to  fix  the 
exact  position  of  the  wage  earner  in  the  national  econ- 
omy. In  the  latest  report  on  prices  and  wages  the 
only  retail  prices  given  are  those  of  food  grains,  only 
one  kind  of  dal  (pulse)  and  salt.  The  report  gives 
wholesale  prices  of  staple  articles  of  export  and  im- 
port, but  they  are  of  no  help  in  fixing  the  wage  earner's 
budget.  As  regards  wages  there  is  also  a  great  deal  of 
confusion.  For  some  districts  the  wages  are  given  up 
to  1906,  for  others  up  to  1907,  1909,  and  1912.  In 
some  cases  the  wages  given  are  monthly  ones ;  in 
others  weekly  or  daily,  rendering  it  impossible  to  make 
comparisons.  However,  some  approximate  idea  of 
wages  can  be  gathered  from  the  following  tables  com- 
piled from  the  above  mentioned  report.  The  Indian 
currency  unit  is  a  rupee.  This  is  divided  into  16 
annas.     Roughly  three  rupees  are  equal  to  an  Ameri- 


APPENDICES  347 

can  dollar  and  an  anna  is  equal  to  two  cents.  We  give 
the  approximate  equation  in  dollars  of  the  Indian 
rupee  in  the  table.  The  wages  are  given  for  the  vari- 
ous towns  mentioned  in  the  report,  omitting  all  refer- 
ence to  Burma. 

Weekly  wage  of  an     Weekly  wage  of  a 
able  bodied  agricul-      mason,  carpenter, 
Bengal.  tural  labourer  or  blacksmith 

Rangpur  $1.00(1910)  $r.66  (igio) 

Backerganje $  .82  to$i.oo  (1910)  $1.30  to  $1.66  (1910) 

Calcutta $1.33(1917)  

Patna     $.49(1907)  $1.00(1907) 

United  Provinces  of  Agra  and  Oude. 

Cawnpore    1906    $.33  to  $.49  $1.66 

Fyzabad     1906    $.16  to  $.33  $  .49  to  $  .66 

Meerut   1906    $  .35  $  .82 

Punjab. 

Delhi   1909  $.82  $1.66 

Ameitsar     ....1909  $.79  $2.50 

Rawalpindi  ...1909  $  .82  $2.33 

Sindh. 
Karachi    1912    $1.08  to  $1.33  $2.08  to  $3.33 

Bombay. 

Belgaum   1908  $  .50  |i.i6  to  $1.33 

Ahmadnagar   .1914  $.82  $1.33  to  $2.00 

Bombay 1912  $1.33  $2.33  to  $3.50 

Ahmadahad   ..1912  $  .66  About  $2.00 

Central  Provinces. 

Jubbulpur  — 1908    $  .50  $2.50 

Nagpur   1908    $  jk>  $2.00  to  $2.50 

Raepur    1908    $.50  $1.33 

Madras. 

Bellary    1907  $.50  Less  than  $1.50 

Madras   1907  $  .50  "       "        " 

Salem    1907  $  -35  "       " 

Postal  Runners.  Only  in  one  division,  that  of 
Sindh,  do  the  postal  runners  in  the  service  of  the  Gov- 
ernment get  one  dollar  a  week.  In  others  they  or- 
dinarily  get    two-thirds    of    that   amount.     In    some 


348  ENGLAND'S  DEBT  TO  INDIA 

places  they  receive  even  less  than  that.  These  are  the 
figures  for  1914. 

Postmen.  Postmen,  who  are  also  in  the  employ  of 
the  Government  and  are  supposed  to  be  literate,  get 
salaries  ranging  in  amount  from  $.90  to  $1.33  per  week 
(1914). 

Railroads.  In  the  railroad  service  (1914)  we  find 
the  following  figures : 

Mirzapur-East  Indian  Railroad. 

Skilled  labour        Unskilled  labour 

Carpenter $1.00  to  $1.66  $.50 

Blacksmith $1.66 

Permanent  Inspector..         $2.00 

Cazvnpore. 
Skilled $  .50  Unskilled. .  .Less  than  $  .50 

Delhi. 
Skilled  labour  from  $1.66  to  $2.30  Unskilled. . .  .about  $  .66 

Lahore  Railway  Work  Shops. 

Skilled  Fitters $1.66  Unskilled $  .70 

Skilled  Carpenters $175 

Average  daily  wages  paid  on  canal  work,  foundries, 
and  workshops: 

Skilled  labour from  7^  to  16^ 

Unskilled  labour ordinarily  below  7<f 

Weekly  zvage  paid  in  a  paper  mill  in  Bengal,  1914: 

Skilled  labour:    Blacksmiths  and  Machine  men $2.50 

Skilled  Unskilled  coolies 

Bricklayers,  Carpenters,  En-  Men $1.00 

gine  men.. from  $1.30  to  $1.50  Women $  .60 

Weekly  wages  in  a  brezvery  in  the  Punjab: 
Skilled  labour  from  $1.66  to  $2.30  Unskilled about  ^.66 

Weekly  wages  paid  in  an  army  boot  factory  at 
Cazvnpore: 

Foreman  $2.50 

Saddlers 2.08 

Machine  operators 1.70 

Fitters   1.40 


APPENDICES  349 

Carpenters   $1.40 

Cutters    82 

Saddler's  assistants i.oo 

Tanners 66 

Messengers  and  stQremen 58 

Beltmakers ^2 

Work  distributors 72 

Average  weekly  wages  in  a  cotton  mill  in  Northern 
India,  191 4: 

Men   from  %.(£  to  $.80 

Women   35 

Children $.35  to  $.43 

Average  weekly  wages  in  a  cotton  mill,  Bombay: 

Scratcher    $1.00 

Grinder  1.30 

Card  tender 85 

Lap  carrier 92 

Fly  carrier 66 

Reeler  1.26  to  1.66 

Presser   1.50 

Binder 1.50  to  3.00 

Drawer  1.16  to  2.16 

Doffer   .84 

Doff  carrier i.oo 

Spare   hands 84  to  i.oo 

Warper 2.14  to  about  3.00 

In  the  sizing  department  the  wages  range  from  $.84 
to  $4.00  a  week,  the  sizer  and  the  weaver  getting 
from  $1.33  to  about  $4.00,  all  the  other  hands  get- 
ting about  one-half  that  amount. 

Average  weekly  wages  paid  in  a  woollen  mill  in 
Northern  India,  19 14: 

Unskilled  labour   ♦ $  .66 

Skilled  labour : 

Card  room: 

Card  mistri $3.33 

Feeder  89 

Card  cleaner 1.33 

Spare   hands 80 

Mixer 80 


350  ENGLAND'S  DEBT  TO  INDIA 

Mule  room: 

Head  mistri $4.16 

Minder    1.33 

Piecer    66 

Spare  hands 84 

Finishing  department: 

Washing  and  bleaching $1.50 

Dyeing    1.60 

Dyer 84 

Weaving  department: 

Mistry a  little  over  $2.00 

Healder   a  little  over    .84 

Weaver a  little  over  i.io 

Engineering  department: 

Boiler  mistri $1-35 

Engine  man 70 

Oil    man 70 

Head  carpenter 3.30 

Turner a  little  less  than  2.00 

Boiler  man 80 

Fitter  1.52 

Blacksmith  2.00 

Carpenter  1.33 

Tinsmith 1.25 

Leather  man 75 

Average  weekly  wage  in  a  jute  mill  in  Bengal,  1^141 

Carding  $  .66 

Spinner  1.16 

Minder i.20 

Beawer 1.40 

Weaver a  little  less  than  2.00 

Coolies less  than  .16  per  day 

Mistries   about    .35  per  day 

Weekly  wage  in  a  Cawnpore  Saddlery  Establish- 
ment, ipij-14: 

Sirdars  $1.00  or  less 

Lascars 50  or  .60 

Carpenters,  workmen 1,00 

Painter  mistries l.oo 

Painter  workmen 83 

Tanner  mistries 28 

Bullock  drivers,  Sweepers 50  or  less 

Water  carriers 50  or  less 


APPENDICES  351 

There  has  been  no  increase  in  these  wages  since  1879 
in  the  case  of  some  of  these  workmen,  and  none  since 
1889  in  that  of  others. 

WAGES   IN    GOVERNMENT   ESTABLISHMENTS 

In  government  offices  most  of  the  menials,  ushers, 
and  orderlies  are  paid  from  $.50  to  $1.00  a  week. 

A  Police  Constable  in  1914,  got  from  $.66  to  about 
$1.00  a  week.  An  officer  in  the  Police  Department 
started  with  a  weekly  salary  of  about  $1.00. 

Primary  School  Teachers  in  some  cases  start  with  a 
salary  of  $.66;  in  others  they  get  from  $.82  to  $1.00 
per  week. 

Clerks  in  Government  Offices  start  with  $1.33  a 
week. 

The  disparity  between  the  salaries  of  the  lowest 
servants  and  those  higher  up,  and  between  Indian  and 
European  governmental  employes  may  better  be  stud- 
ied from  the  figures  given  in  the  next  appendix. 


APPENDIX  E 

THE   COST  OF   ADMINISTRATION    IN    INDIA,   JAPAN,    AND 
THE    UNITED    STATES    OF    AMERICA 

The  President  of  the  United  States,  who  ranks  with 
the  great  royalties  of  the  world  in  position,  gets  a  sal- 
ary of  $75,000  without  any  other  allowance.  The 
Prime  Minister  of  Japan  gets  12,000  yen,  or  $6,000. 
The  Viceroy  and  the  Governor  General  of  India  get 
250,000  ^  rupees,  or  $83,000,  besides  a  very  large 
amount  in  the  shape  of  various  allowances.  The  cabi- 
net ministers  of  the  United  States  get  a  salary  of 
$12,000  each,  the  Japanese  8,000  yen,  or  $4,000,  and 
the  Members  of  the  Viceroy's  Council  $26,700  each. 

In  the  whole  Federal  Government  of  the  United 


35^  ENGLAND'S  DEBT  TO  INDIA 

States  there  are  only  three  offices  which  carry  a  salary 
of  more  than  $8,000  a  year.     They  are : 

The  President  of  the  General  Navy  Board $13,500 

Solicitor  General 10,000 

Assistant  Solicitor  General 9,000 

All  the  other  salaries  range  from  $2,100  to  $8,000. 
In  the  State  Department  all  offices,  including  those  of 
the  secretaries,  carry  salaries  of  from  $2,100  to  $5,000. 
In  the  Treasury  Department,  the  Treasurer  gets 
$8,000,  three  other  officers  have  $6,000  each.  All  the 
remaining  officials  get  from  $2,500  to  $5,000.  In  the 
War  Department  there  are  only  two  offices  which  have 
a  salary  of  $8,000  attached  to  them:  that  of  Chief  of 
Staff  and  that  of  Quarter  Master  General.  The  rest 
get  from  $2,000  to  $6,000.  In  the  Navy  Department 
besides  the  President  of  the  General  Board  mentioned 
above,  the  President  of  the  Naval  Examination  Board 
gets  $8,000  and  so  does  the  Commandant  of  the  Ma- 
rine Corps.  All  the  rest  get  from  $6,000  downwards. 
In  the  Department  of  Agriculture  there  is  only  one 
office  carrying  a  salary  of  $6,000.  All  the  rest  get 
from  $5,000  downwards.  The  Chief  of  the  Weather 
Bureau,  an  expert,  gets  $6,000.  In  the  Commerce  De- 
partment four  experts  get  $6,000  each,  the  rest  from 
$5,000  downwards.     These  are  the  annual  salaries. 

In  Japan  the  officials  of  the  Imperial  Household 
have  salaries  ranging  from  $2,750  to  $4,000.  Offi- 
cials of  the  Higher  Civil  Service  get  from  $1,850  to 
$2,100  a  year;  the  Vice-Minister  of  State,  $2,500; 
Chief  of  the  Legislative  Bureau,  $2,500;  the  Chief 
Secretary  of  the  Cabinet,  $2,500;  and  the  Inspector 
General  of  the  Metropolitan  Police,  $2,500;  President 
of  the  Administrative  Litigation  Court,  $3,000;  Presi- 
dent of  the  Railway  Board,  $3,750;  President  of  the 
Privy  Council,  $3,000;  Vice-President  of  the  Privy 
Council,  $2,750,  and  so  on.  All  these  salaries  are 
yearly. 

When  we  come  to  India  we  find  that  the  President 


APPENDICES  353 

of  the  Railway  Board  gets  from  $20,000  to  $24,000, 
and  that  two  other  members  of  the  Railway  Board  get 
$16,000.  Secretaries  in  the  Army,  Public  Works,  and 
Legislative  departments  get  $14,000.  Secretaries  in 
Finance,  Foreign,  Home,  Revenue,  Agriculture,  Com- 
merce, and  Industry  departments  get  $16,000.  The 
Secretary  in  the  Education  Department  gets  $12,000; 
Joint  Secretary,  $10,000;  Controller  and  Auditor  Gen- 
eral, $14,000;  Accountant  General,  from  $9,000  to 
$11,000;  Commissioner  of  Salt  Revenue,  $10,000;  Di- 
rector of  Post  and  Telegraph  from  $12,000  to  $14,000. 
Among  the  officers  directly  under  the  Government 
of  India  there  are  only  a  few  who  get  salaries  below 
$7,000.  Most  of  the  others  get  from  that  sum  up  to 
$12,000.  The  fact  that  the  population  of  the  United 
States  consists  of  people  of  all  races  and  that  there  is 
a  constant  flow  of  immigration  makes  the  work  of  ad- 
ministration very  difficult  and  complex  —  far  more  so 
than  the  administrative  problems  in  India. 

PROVINCIAL   ADMINISTRATION 

The  United  States  Government  has  under  it  48 
States  and  Territories.  Some  of  them  are  as  large  in 
area,  if  not  even  larger  than  the  several  provinces  of 
India.  The  Governors  of  these  States  are  paid  from 
$2,500  to  $12,000  a  year.  Illinois  is  the  only  State 
paying  $12,000;  five  States,  including  New  York  and 
California,  pay  $10,000;  two,  Massachusetts  and  In- 
diana, pay  $8,000;  one  pays  $7,000,  and  three  pay 
$6,000.  All  the  rest  pay  $5,000  or  less.  There  is 
only  one  territory  under  the  United  States  Govern- 
ment, the  Philippines,  which  pays  a  salary  of  $20,000 
to  its  Governor  General.  In  India,  the  Governors  of 
Madras,  Bombay,  and  Bengal  each  receive  $40,000, 
besides  a  large  amount  for  allowances.  The  Lieu- 
tenant Governors  of  the  Punjab,  the  United  Provinces, 
Behar  and  Burma  get  $33,000  each  besides  allow- 
ances. The  Chief  Commissioners  receive  $11,000  in 
Behar,  $18,700  in  Assam,  $20,700  in  the  Central  Prov- 


354  ENGLAND'S  DEBT  TO  INDIA 

inces,  and  $12,000  in  Delhi.  The  Political  Residents 
in  the  Native  States  receive  from  $11,000  to  $16,000, 
besides  allowances.  In  Japan  the  Governors  of  Prov- 
inces are  paid  from  $1,850  to  $2,250  per  year,  besides 
allowances  varying  from  $200  to  $300. 

The  provincial  services  in  India  are  paid  on  a  far 
more  lavish  scale  than  anywhere  else  in  the  world.  In 
Bengal  the  salaries  range  from  $1,600  for  an  assist- 
ant magistrate  and  collector  to  $21,333  to  Members  of 
the  Council,  and  this  same  extravagance  is  also  true 
of  the  other  provinces. 

Coming  to  the  Judiciary,  we  find  that  Justices  of  the 
Supreme  Court  of  the  United  States  get  a  salary  of 
$14,500  each,  the  Chief  Justice  getting  $15,000;  the 
Circuit  Judges  get  a  salary  of  $7,000  each,  the  District 
Judges  $6,000.  In  the  State  of  New  York  the  Judges 
of  the  Supreme  Court  belonging  to  the  General  Ses- 
sions get  from  $17,500,  and  those  of  the  Special  Ses- 
sions from  $9,000  to  $10,000  each.  City  Magistrates 
get  from  $7,000  to  $8,000  each.  In  India  the  Chief 
Justice  of  Bengal  gets  $24,000;  the  Chief  Justices  of 
Bombay,  Madras,  and  the  United  Provinces,  $20,000 
each.  The  Chief  Judges  of  the  Chief  Court  of  the 
Punjab  and  Burma  get  $16,000  each,  and  the  Puisine 
Judges  of  the  High  Courts  the  same  amount.  The 
Puisine  Judges  of  the  Chief  Courts  receive  $14,000. 
In  the  Province  of  Bengal  the  salaries  of  the  District 
and  Session  Judges  range  from  $8,000  to  $12,000. 
District  Judges  of  the  other  provinces  get  from  about 
$7,000  to  $12,000.  The  Deputy  Commissioners  in  In- 
dia get  a  salary  in  the  different  provinces  ranging  from 
$6,000  to  $9,000  a  year.  The  Commissioners  get  from 
$10,000  to  $12,000.  In  Japan,  the  Appeal  Court 
Judges  and  Procurators  get  from  $900  to  $2,500  a 
year.  Only  one  ofificer,  the  President  of  the  Court  of 
Causation,  gets  as  much  as  $3,000.  The  District 
Court  Judges  and  Procurators  are  paid  at  the  rate  of 
from  $375  to  $1,850.  It  is  needless  to  compare  the 
salaries  of  minor  officials  in  the  three  countries.     Since 


APPENDICES  355 

the  Indian  taxpayer  has  to  pay  so  heavily  for  the 
European  services  engaged  in  the  work  of  administra- 
tion, it  is  necessary  that  even  the  Indian  officers  should 
be  paid  on  a  comparatively  high  scale,  thus  raising  the 
cost  of  administration  hugely  and  affecting  most  in- 
juriously the  condition  of  the  men  in  the  lowest  grades 
of  the  Government  service.  The  difference  between 
the  salaries  of  the  officers  and  the  men  forming  the 
rank  and  file  of  the  Government  in  the  three  countries 
shows  clearly  how  the  lowest  ranks  in  India  suffer  from 
the  fact  that  the  highest  governmental  officials  are  paid 
at  such  high  rates. 

THE  POLICE 

In  New  York  City,  the  Chief  Inspector  gets  $3,500 
a  year;  Captains,  $2,750;  Lieutenants,  $2,250;  Ser- 
geants, $1,750,  and  Patrolmen,  $1,400  each.  In  Japan 
the  Inspector  General  of  the  Metropolitan  Police  gets 
$2,500.  The  figures  of  the  lower  officials  are  not 
available,  but  the  minimum  salary  of  a  constable  is 
$6.50  per  month,  besides  which  he  gets  his  equipment, 
uniform  and  boots  free.  In  India,  the  Inspector  Gen- 
erals get  from  $8,000  to  $12,000,  Deputy  Inspector 
Generals  from  $6,000  to  $7,200,  District  Superintend- 
ents of  Police  from  $2,666  to  $4,800,  assistants  from 
$1,200  to  $2,000,  Inspectors  from  $600  to  $1,000,  Sub- 
Inspectors  from  $200  to  $400,  Head  Constables  from 
$60  to  $80,  Constables  from  $40  to  $48  per  year.  We 
have  taken  these  figures  from  the  "  Indian  Year 
Book "  published  by  the  Times  of  India,  Bombay. 
We  know  as  a  fact  that  the  Police  Constables  in  the 
Punjab  are  paid  from  $2.67  to  $3.33  per  month,  that 
is  from  $32  to  $40  per  year.  The  reader  should  mark 
the  difference  between  the  grades  of  salaries  from 
the  highest  to  the  lowest  in  India,  as  compared  with 
the  United  States  and  Japan.  While  in  India  the 
lowest  officials  are  frightfully  underpaid,  the  highest 
grades  are  paid  on  a  lavish  scale.  In  the  other  coun- 
tries of  the  world  this  is  not  the  case. 


356  ENGLAND'S  DEBT  TO  INDIA 

EDUCATIONAL   DEPARTMENT 

In  the  United  States  (we  quote  the  figures  of  New 
York  City),  the  lowest  school  teachers  get  a  salary 
of  $720,  rising  to  $1,500  a  year.  In  the  upper  grades 
salaries  range  from  $1,820  to  $2,260.  Principals  of 
elementary  schools  receive  $3,500,  and  assistants 
$2,500.  In  the  High  Schools,  salaries  range  from 
$900  to  $3,150,  in  Training  Schools  from  $1,000  to 
$3,250.  Principals  of  High  Schools  and  Training 
Schools  receive  $5,000  and  the  same  salary  is  paid 
to  the  District  Superintendents.  The  Commissioner 
of  Education  in  New  York  gets  $7,500.  In  Japan  the 
Minister  of  Education,  who  is  a  Cabinet  Member,  gets 
$4,000,  and  the  lowest  salaries  paid  to  teachers  range 
from  $8  to  $9  per  month.  In  the  United  States,  col- 
lege professors  make  from  $5,000  to  $7,000  per  year. 
In  Japan  they  range  from  $300  to  $2,000.  Coming  to 
India,  we  find  that  while  the  administrative  officers 
and  even  the  college  professors  get  fairly  high  salaries, 
the  teachers  in  the  schools  are  miserably  underpaid. 

CONCLUSION 

We  don't  believe  there  is  a  single  country  in  the 
world  where  the  difference  between  the  remuneration 
allowed  to  the  highest  and  the  lowest  officials  is  so 
disproportionally  marked  as  in  India.  Yet  we  find 
that  there  is  a  tendency  still  further  to  increase  the 
salaries  of  the  high  officials,  European  and  Indian, 
while  even  very  slight  increase  in  the  salaries  of  the 
underpaid  lowest  servants  of  the  State  are  most  grudg- 
ingly given.  Moreover,  the  high  officials  get  allow- 
ances almost  equal  in  amount  to  their  salaries.  This 
is  not  true  in  the  case  of  the  lower  officials.  The 
fact  is  that  the  British  Government  in  India  does  not 
attach  enough  importance  to  the  common  man ;  his 
needs  are  often  overlooked  in  the  desire  to  please  the 
high  officials  and  keep  them  contented.  Considering 
that  every  man  in  India  is  supposed  to  have  a  family, 


APPENDICES  357 

the  condition  of  the  lowest  officials  is  most  miserable, 
in  some  cases  almost  necessitates  corruption.  The  Gov- 
ernment of  India  must  know  this,  yet  they  do  nothing 
to  remedy  the  state  of  affairs.  A  rise  in  prices  is 
claimed  as  a  good  ground  for  raising  the  salaries  of 
the  highly  paid  civilians,  but  the  same  weight  is  not 
attached  to  that  reason  when  the  question  of  increas- 
ing the  salaries  of  the  lower  grades  arises. 

The  figures  relating  to  military  services  in  India 
are  not  available,  but  we  know  that  the  above  remarks 
and  comparisons  have  as  much  force  in  the  case  of 
the  Military  Service  as  they  have  in  the  ones  we  have 
cited  above. 

Note.  The  Royal  Commission  on  Public  Services 
has  actually  recommended  a  substantial  increase  in  the 
salaries  of  European  officials  by  the  incorporation  of 
what  was  temporarily  allowed  to  them  as  exchange 
compensation  allowance,  in  their  salaries  as  also  other- 
wise. 

PROPORTION   OF   INDIANS    IN    HIGHER   SERVICES  — • 
LATEST   FIGURES 

Total  of  appointments  with  a  salary  of  Rs.  200  a 
month  or  upward  ($66)  11,064.  Held  by  Indians,  42 
per  cent. 

Total  of  appointments  with  a  salary  of  Rs.  500  per 
month  ($166)  =4,986.     Held  by  Indians,  19  per  cent. 

Total  of  appointments  on  Rs.  800  per  month  or  above 
=z  2,501.     Held  by  Indians,  10  per  cent. 

APPENDIX  F 

FURTHER    NOTES 

Gold  Value  of  Rupee.  Until  1871  the  gold  value  of 
the  rupee  except  in  one  year  always  exceeded  is.  iid. 
In  1872-3  it  fell  to  a  little  over  is.  lo^d.  and 
thenceforward  downward  until  in  1894-5  it  reached 
IS.  id.  The  difference  it  made  to  India  may  be  judged 
from  the  fact  that  the  sterling  value  of  the  bills  paid 


358  ENGLAND'S  DEBT  TO  INDIA 

in  England,  in  1894-5,  was  ^15,770,533-  The  rupee 
equivalent  actually  paid  by  the  Government  of  India 
was  28-9  crores  (or  280-9  millions)  of  rupees  while 
at  the  rate  prevailing  in  1872-3  it  would  have 
amounted  to  only  16-6  crores.  in  this  way  India 
suffered  a  high  financial  loss.  The  sterling  debt  con- 
tracted at  the  time  when  the  value  of  the  rupee  was 
about  2s.  was  afterwards  converted  into  a  rupee 
debt  when  the  value  of  the  rupee  had  fallen  to  is.  4d. 

Says  Mr.  A.  J.  Wilson  ("An  Empire  in  Pawn"), 
p.  26: 

"  The  Indian  people  pay  altogether  more  now  than 
ever  they  did.  More  of  the  net  proceeds  of  their 
labour  goes  every  year  to  pay  the  foreign  debt  charges 
under  one  head  or  another,  because  the  aggregate  of 
these  charges  increases." 

"  The  ofificial  mind  has  created  a  cloud-world  of  its 
own  and  looks  at  all  Indian  affairs  from  a  point  of 
view  so  far  above  everything  native,  so  conventional 
and  entirely  bureaucratic,  that  it  is  easily  able  to  dem- 
onstrate to  us  a  priori  that  Indian  populations  are 
happy  and  flourishing,  though  millions  of  them  be 
dead  of  starvation  or  to  gush  about  loyalty  with  a 
mutiny  and  massacre  hanging  on  their  heads." 

(P.  28.)  "The  Stracheys  and  men  of  that  official 
set  present  only  the  outside  of  the  sepulchre  to  view. 
There  is  an  official  India  where  all  is  well,  an  India 
serenely  indifferent  to  the  toiling  India,  and  there  is 
an  India  composed  of  nearly  200  millions  of  toiling 
and  suffering  people." 

(P.  28.)  "The  truth  of  the  matter  is,  that  the 
natives  of  India  are  in  no  sense  their  own  masters  in 
the  conduct  of  their  trade  any  more  than  in  the  conduct 
of  their  government.  Our  system  of  land  revenue 
alone  would  bring,  and  does  bring  them  into  a  state  of 
slavery  and  abject  dependence,  almost  whether  we 
like  it  or  not." 


INDEX 


Abdurizag,  12,  164 

Adams,  Brooks,  on  the  plun- 
der of  India,  48;  the  effect 
in  England,  49 

Aden,  117 

Afghan  War,  105-6 

Agrarian  legislation,  282 

Agriculture,  chief  Indian  in- 
dustry, 181,  331 ;  Bengal, 
193  ff ;  Bombay,  225  ;  Cen- 
tral Provinces,  239;  export 
tables,  184-5 ;  land  revenue 
assessments,  189  ff;  land 
revenue  receipts,  241 ; 
Northern  India,  216  ff; 
Punjab,  23s ;  policy  of  Eng- 
land, 240;  crops,  area  of, 
183-4 

Akbar,  14,  15,  163 

Arbuthnot,  Sir  A.,  on  trade 
"interests,"  148 

Arcot,  17 

Army,  Indian,  104,  107;  ex- 
pense of,  109,  316;  Lord 
Roberts  on,  104,  108;  Lord 
Lansdowne  on,  107;  Sir 
Henry  Brackenberry  on, 
108;  wars  outside  India, 
109-111 

Art  schools,  303 

Aurangzeb,  15 


B 


Baber,  11,  13 

Baines,    on    cotton    industry, 

121,  126,  127-8 
Bengal,    early    condition,    25; 

land  ruin,  193  ff 

329 


Bentinck,  Lord,  admits  Brit- 
ish failure  in  India,  37 

Blunt,  W.  S.,  on  Indian  pov- 
erty, 253-4 

Bolts,  William,  on  India's 
trade,  56,  65 

Brackenberry,  on  Indian 
Army,  108 

Brago,  Sergt,  on  Indian  in- 
dustrial ruin,  55 

Briggs,  Lt.-Col.,  on  land  tax, 
233-S' 

Bright,  John,  on  mutiny  ex- 
penditure, 90 ;  cotton  indus- 
try   investigation,    116,    124 

Bruce,  on  early  Indian  splen- 
dour, 44 

Burke,  on  India's  trade  ruin, 
67  f{;  on  Nawab  of  Arcot's 
debts,  201-2 

Burmah,  116 


Caesar  Frederic,  12 

Canals,  see  Irrigation,  Font' 
ines,  Railways 

Chintamini,  on  economic  con- 
ditions, 330-336 

Clive,  Lord,  25,  52,  59,  61,  63- 
64;  letter  on  Bengal  extor- 
tions, 60 

Coal,  178 

Coffee,  179 

Collen,  Sir  Edvi^in,  on  mili- 
tary expenses,  152 

Commercial  schools,  sc; 

Connell,  A.  K.,  on  Indian 
railways,  243-6,  297 

Copper,  T77 

Cornwallis,  Lord,  on  increas- 


360 


INDEX 


ing  misery  of  India,  37 ;  on 
land  settlement.  188 

Cotton,  J.  S.,  on  the  "  Drain," 
86,  100;  on  trade,  100;  on 
iron,  175-6 ;  on  agriculture, 
181 ;  on  economic  condi- 
tion of  the  people,  249 

Cotton  industry  in  India,  46, 
121;  case  for  and  against 
England,  157-8;  Lord  Cur- 
zon  on  duties,  160;  decline 
of,  128;  Defoe  on  Indian 
fabrics,  126;  early  mention 
of,  121 ;  English  legislation, 
141  ff ;  excellence  of,  123 ; 
extent,  124;  duties,  141  ff; 
present  duties,  159;  Larpent 
and  others  on  the  decline, 
134  ff;  machinery  and  the 
industrial  revolution  in 
England,  49 ;  Montgomery 
Martin,  138;  1917  develop- 
ments, 159;  the  renascent 
industry,  152,  154-5,  156 

Crops,  area  in  India,  183-4 

Curzon,  Lord,  3;  on  cotton 
industry,  160 


Debt,  Indian,  go;  increase,  91 ; 
division  of,  99;  R.  Dutt  on, 
88 

Digby,  on  the  "Drain,"  71,  92, 
96 ;  on  decline  of  India's 
shipping,  168;  on  famines, 
264 ;   on  gold  supply,  309 

"Drain"  or  Tribute,  69 ff; 
meaning  of,  84;  extent,  91; 
mutiny  expenditures,  89; 
English  profit,  102 ;  Hynd- 
man  on,  70,  94,  96;  Digby, 
71,  92;  Francis,  71;  Shore, 
72 ;  Sullivan,  73-5  ;  Wilson, 
H.  H.,  78;  Lord  Salisbury, 
78;  Wilson,  A.  J.,  78,  96; 
Dr.  Sunderland,  78;  Win- 
gate,  76;  Cotton,  J.  S.,  86, 
100;   Martin,   JT,   92;    esti- 


mates, 102;  Tucker,  Henry 

St.  G.,  n 

Dutt,  Romesh,  on  Governor 
Verelst,  53 ;  on  Warren 
Hastings,  53-54;  Sergt. 
Brago,  55 ;  quotes  British 
merchants,  58;  Clive,  61 ;  on 
"  Drain,"  "]"] ;  on  India's 
debt,  88;  on  cotton  indus- 
try, 132,  144;  decay  of  vil- 
lage communities,  205 ;  on 
land  evils,  208.  238 

Dutch,  in  trade,  44 


East  India  Company,  its  pol- 
icy, 321 ;  administration  of 
land,  193  ff;  profits,  44-g, 
66;  its  import  of  cotton  to 
England,  125  ff;  influence 
on  Indian  shipping  industry, 
165  ff;  rapacity,  18-29,  48, 
51,  54-7,  58,  64 

Economic  condition  of  people, 
156;  Loveday  on,  245;  Hun- 
ter on,  248,  252 ;  Chintamini, 
330-.36.  See  also  Poverty, 
Famines 

Education  in  India,  297;  early 
conditions,  299;  of  Euro- 
peans, 305 ;  facts  and  fig- 
ures, 300;  tables,  301-2;  of 
girls.  306;  agricultural,  302; 
technical  and  industrial, 
303 ;  commercial,  305  ;  ex- 
penditures, 317;  art  schools, 
30.'5 

Elphmstone,  on  mediaeval  In- 
dia, 11-15;  on  British  set- 
tlement of  conquered  terri- 
tory, 225-8 

Empire,  India  and  the,  103 ; 
and  other  nations  of  Asia, 
114;  Isle  of  France,  115; 
Muluccas,  115;  Ceylon,  115; 
Eastern  Archipelago,  115; 
Siam     and     Cochin-China 


INDEX 


361 


116;  Burmah,  116;  Malacca. 
116;  Aden,  117;  wars  out- 
side India,  109-13;  the 
Persian  mission,  105 ;  for- 
eign wars  paid  by  India, 
105-6;  the  Zanzibar  and 
Mauritius  cable,  117;  Red 
Sea  telegraph,  117 


Famines  in  India,  in  the  past, 
263 ;  Digby's  table,  264 ;  in- 
crease under  British  rule, 
268 ;  causes,  269 ;  rainfall, 
270 ;  overpopulation,  271 ; 
food  scarcity,  274;  the  true 
cause,  276;  famine  relief, 
277;  relation  to  railways 
and  canals,  280;  land  pres- 
sure, 281 ;  agricultural 
banks,  281 ;  agrarian  legis- 
lation, 282;  Dr.  Sunderland 
on,  251,  263,  270-6;  Sir 
Theodore  Morison's  de- 
fence of  England.  263; 
Thorburn  on,  275 ;  Macdon- 
ald  on,  274,  277-^78 

Feroz  Shah,  11 

Foreign  wars  charged  to  In- 
dia, 148 

Francis,  Philip,  on  the 
"Drain,"  71;  on  British 
conquest,  322 

Friend  of  India,  The,  on  the 
wretchedness  in  Oude,  35, 
37 

Fullarton,  Col.,  on  Hyder 
Ali's  reign,  23 


Grant,  Charles,  admission  on 
the  "Drain,"  72 

H 

Hamilton,  Sir  D.,  on  poverty, 
312 


Hastings,  Warren,  in  India, 
27-8,  37,  53-54,  196-7 

Heber,  Bishop,  observations 
in  India,  35 ;  on  taxation, 
230 

Hunter,  on  economic  condi- 
tion of  the  people,  248,  252 ; 
on  intent  of  the  British  in 
conquest,  319 

Hyder  Ali,  22-4 

Hyndman,  H.  M.,  on  the 
"  Drain,"  70,  94,  96,  99,  102 ; 
on  poverty,  252 


Ibn  Batuta,  12 

Income,  average  of  people,  3, 
2=50  ff;  appendix  B;  appen- 
dix D 

India,  agricultural  condition, 
181 ;  as  army  training 
ground,  108;  army,  104-7; 
British  occupation,  17-39, 
319;  and  the  "Empire," 
103 ;  early  prosperity,  5,  10- 
13,  24,  44;  cotton  in,  121; 
decline  oi  cotton  industry, 
128;  decline  of  shipping  in- 
dustry, 167;  economic  con- 
dition, 245 ;  education, 
299  ff;  export  tables,  105, 
184-8;  famines,  263  flf ;  "gol- 
den age,"  4;  industries, 
173  ff;  land  problem  and 
taxes,  188  ff;  British  land 
policy,  24s;  the  "milch- 
cow  "  of  the  "  Empire," 
103;  Moghul  emperors,  6; 
Mohammedan  rule,  10; 
Northern  India,  conditions, 
24,  216;  early  political  di- 
visions, 16 ;  poverty,  245  ff ; 
pre-British  period,  16;  pros- 
perity fallacies,  308;  rail- 
ways and  canals.  283  ff ; 
remedy  for  the  Indian  prob- 
lem, 334  ff;  trade,  early,  43; 
trade   after    Plassey,   49  ff; 


362 


INDEX 


trade  ruin,  64;  taxes,  314; 
tribute  or  "  Drain,"  69  ff 

Indian  Year  Book,  on  recent 
industrial  situation,  152  flf; 
on  iron,  etc.,  177 

Industries,  173;  indigo,  173; 
jute,  174;  woollen  mills, 
174;  paper  mills,  175;  brew- 
eries, 17s ;  rice  and  saw 
mills,  175;  manganese,  177; 
copper,  177 ;  tea  and  coffee, 
179;  see  also,  Agriculture, 
Cotton,  Shipping 

Industrial  revolution  in  Eng- 
land, India's  part  in,  49, 
125  ff 

Iron,  179 

Irrigation,  290 

Isle  de  France,  115 


Jute,  174 


Land  tax,  188  ff,  233 ;  tests  of, 
192  ff 

Lansdowne,  Lord,  on  Indian 
Army,  107 

Larpent,  and  others,  on  de- 
cline of  Indian  cotton  in- 
dustry,  119  ff 

Lawrence,  Sir  John,  commis- 
sioner of  the  Punjab,  255 

Loveday,  A.,  245 

M 

Macao,  114 

Macdonald,  J.  Ramsay,  on 
famines,  260,  274;  relief 
work,  277-8 

Macaulay,  on  India's  wretch- 
edness under  Qive,  26.  64; 
on  the  Company's  profits,  46 

Madras,  199  ff;  appendix  C 

Mahmud.  10 

Mahrattas,  30-31 


Malacca,  116 

Malcolm,  Sir  John,  32;  on  the 
"Drain,"  75;  on  Clive,  60; 
on  Persian  alliance,  112 

Manganese,  177 

Martin,  Montgomery,  on  the 
"  Drain,"  77,  92 ;  on  cotton, 
138 

Mill,  James,  on  evils  of  Brit- 
ish rule,  20;  on  Hyder  AH, 
32;  on  Clive,  63;  extortion 
in  Oude,  28;  on  Company's 
officials,  58;  land  frauds, 
201 ;  on  Persian  Treaty,  112 

Minerals,  178 

Minto,  114-S;  on  land  situa- 
tion, 221 

Mir  Kassim,  52 

Moghul  emperors,  6 

Mookerji,  Prof.  Radhaku- 
mund,  on  India's  early  mar- 
itime power,  162,  164,  166 

Moore,  prosperity  under  Tipu, 
23 

Morison,  Sir  Theodore,  on 
famines,  263 

Muhammad  AH,  18 

Muir,  on  extortion  by  British, 
51-3;  on  Clive,  63 

Munro,  Sir  Thomas,  on 
Hindu  civilisation,  131 

Mysore,  22-4 

N 

Nadir  Shah,  15 

Northbrook,    Lord,    on    wars 

outside    India,    109-11;    on 

cotton  revenue,  14s 


Oude,    extortion    in,    27-9; 
wretchedness,  35,  216 


Paper  mills,  175 
Persian  mission,  106;  war, 
105 


INDEX 


363 


Plassey,  effects  of,  51 

Pondicherry,  18 

Population,  in  relation  to 
famines,  271  ff 

Portuguese  trade  with  India, 
44 

Poverty,  245 ;  Bayes  quoted, 
256;  Cotton,  249;  Elliott, 
24q;  Grierson,  258;  Hunter, 
248;  Hyndman,  252;  The 
Indian  Witness,  24Q ;  Irwin, 
257 ;  Lawrence,  2.=?5 ;  Mac- 
donald,  260;  6'Donnell, 
260;  The  Pioneer,  255,  258; 
Rose,  256;  Sunderland,  251 ; 
Thorburn  on  (in  Punjab), 
258;  Toynbee,  257;  Wacha, 
2Zy,  Ward,  256;  White,  256 

Pratap  Singh,  17 

Protest  of  Nabob  of  Bengal 
against  extortion,  54 

R 

Railways,  283 ;  government 
policy,  283;  tables,  284-5; 
outlay,  and  income  from, 
28Q ;  and  Indian  trade,  292  ; 
Indian  benefits  from  capi- 
tal investments,  297;  and 
irrigation,  298;  Connell  on 
results  in  India,  293-6,  297; 
Wacha  on  financial  policy, 
287-92 

Rainfall  in  relation  to  fam- 
ines, 270 

Red  Sea  telegraph,  117 

Reform  pamphlets  quoted,  6, 
10,  13,  14,  25-29,  33 

Remedy  for  Indian  problem, 
334 

Rice  Mills,  175 

Roberts,  Lord,  on  Indian 
Army,  104,  108 


Salisbury,      Lord,      on      the 


"Drain,"  78;  on  industrial 
situation,  129,  131 

Saw  mills,  175 

Sevajee,  not  a  robber,  29 

Shipping  industry  in  India, 
162 ;  in  early  times,  163  ff ; 
in  Bombay  and  Calcutta, 
165-6;  Lord  Wellesley  on, 
167 ;  comparative  tables, 
168-72;  Mookerji  on,  162, 
164-6;  Lt.-Col.  Walker,  166; 
Digby  on  England's  respon- 
sibility for  the  decline,  168 

Shore,  F.  J.,  on  the  "Drain," 
72 

Silk,  see  Cotton 

Soudan  War.  106 

Stokes,  Whitley,  on  Indian  in- 
dustries and  finance,  147 

Sullivan,  John,  on  the 
"Drain,"    73-5 

Sunderland,  Dr.,  on  the 
"Drain,"  78;  on  famines, 
251,  263,  270-276 


Tamerlane,  11 

Tan  j  ore,  17-21 

Taxes,  314  ff;  tabulated,  315; 
appendix  A 

Tea,  179 

Thorburn,  on  land  problems, 
238 ;  on  despotism,  340 ;  on 
poverty,  in  Punjab,  258;  on 
famines,  275 ;  on  canals,  192, 
280 

Thornton,  description  of  An- 
cient India,  4 

Tipu,  21-4;  Moore's  estimate, 
23 

Torrens,  M.  P.,  compares  In- 
dia with  Europe,  9;  on 
broken  Carnatic  treaty,  19; 
on  Hyder  AH,  22 ;  on  Wel- 
lesley, 325-326;  on  British 
conquest,  326 

Trade,  early,  of  India,  43-8; 
after     Plassey,    51 ;     under 


364 


INDEX 


Give,  59  ff;  the  ruin  of, 
64  ff;  Burke  on,  67  ff;  bal- 
ance in  India's  favour,  5 ; 
trade  oppression,  65 ;  Ar- 
buthnot  on,  148;  recent  de- 
velopments, 152  ff 

Tribute,  see  "  Drain  " 

Tucker,  Henry  St.  G.,  on  the 
"  Drain,"  77 


Verelst,  Governor,  53 ;  on  un- 
fair trade,  66 ;  on  land  evils, 
194 

W 

Wacha,  D.  E.,  on  railway  fi- 
nance, 287-92 ;  on  military 
expenditures,  .316;  on  tariff 
commissions,  329;  on  pov- 
erty, 333 


Walker,  Lt.-Col.,  on  quality  of 
Indian  shipping,  166 

Wages,  in  India,  appendix  D 

Wealth  England  derived  from 
India,  50  ff 

Wellesley,  Lord,  treaty,  19- 
21,  325-6;  on  shipping  in- 
dustry, 167 

Wellington,  The  Duke  of,  on 
evils  of  treaties  with  India, 
20 

Wilson,  A.  J.,  on  the  "  Drain," 
78,  96,  99,  102 

Wilson,  H.  H.,  on  the 
"  Drain,"  78 

Wingate,  Sir  George,  on  the 
"  Drain,"  yy  ;  on  mutiny  ex- 
penditures, 90 

Woollen  Mills,  174 


Zanzibar  and  Mauritius  Ca- 
ble, 117 


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